I wouldn't say that the problem is "maximizing profits" per se. The problem is the focus on "maximizing profits in the short term".
Which brings us to another problem: that predicting the effects of a business decision on profits in the short term is easy enough, while predicting it in the long term is much more difficult (even impossible, depending on how you define "predicting").
Simplifying, for the long term you need vision, leadership and entrepreneurs. For the short term you need formulas, management and MBAs. Quite often the two needs clash with each other.
A century ago there was a lack of management skills and applying them brought big results. Now we are probably (well) past the point of diminishing returns - even negative returns in the long run, and what is missing is vision, both at the corporate AND at the political level.
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I wouldn't say that the problem is "maximizing profits" per se. The problem is the focus on "maximizing profits in the short term".
Which brings us to another problem: that predicting the effects of a business decision on profits in the short term is easy enough, while predicting it in the long term is much more difficult (even impossible, depending on how you define "predicting").
Simplifying, for the long term you need vision, leadership and entrepreneurs. For the short term you need formulas, management and MBAs. Quite often the two needs clash with each other.
A century ago there was a lack of management skills and applying them brought big results. Now we are probably (well) past the point of diminishing returns - even negative returns in the long run, and what is missing is vision, both at the corporate AND at the political level.