Every business has six critical elements called Morphemes. Morpheme #1 is The Premise (covered in PhilTakes #16-20). Morpheme #2 is The Promise (PhilTakes #21-25). Morpheme #3 – The Sidelines – refers to limitations external forces put on your business, and PhilTakes #27-29 discussed what can happen when companies step outside these boundaries.
Why would a company ignore sidelines (rules, laws, regulations, contracts, agreements, taxes, etc.)? Oftentimes, out of desperation. Desperate people do desperate things. Remember, companies don’t make decisions; people within a company make decisions.
And decision-making processes are impacted by the situation at hand. When times are tough, when cash is scarce and demands from collectors are high, common sense is quickly forgotten. There is no long-term thinking.
The desperate decision-maker may not be thinking about the future, but the entities that impose the limitations are.