When Is Greed Good?

A lot of us think the world would be a better place if people were more caring and less greedy.

Take the crucial job of lifeguarding. If my child's in the pool, I don't want some greedy profit-driven company overseeing lifeguards. I'm relieved that most lifeguards are trained by the Red Cross. They're nonprofit. So, they're selfless. And that's a good thing when someone's drowning.

But entrepreneur Jeff Ellis, who heads Ellis & Associates, says he's proven otherwise. Ellis doesn't work for the Red Cross; he trains lifeguards because he wants to make money. He says he can provide better trained lifeguards and turn a profit for his company.

"We're constantly criticized for being a profit company versus a nonprofit agency. And I think, by all measure, the profit company delivers a better service at a cheaper price," he said.

To win business, Ellis has had to constantly innovate. That profit-motivated creativity, he says, ultimately leads to better lifesaving techniques.

Ellis invented the "rear huggie" rescue, which places the weight of the victim on the rescue tube, instead of on the lifeguard. He was the first to require the "compact jump." He makes his lifeguards carry a plastic mouthpiece to help with mouth-to-mouth. The Red Cross has since adopted many of Ellis' techniques.

Competition Drives Innovation

Ellis thinks complacency kept Red Cross from coming up with those innovative techniques on their own. It may be one reason that hundreds of pools have now switched from Red Cross lifeguards to guards trained by Ellis' company. They like the training and the follow-up.

Does a profit motive really make people better lifeguards? Isn't saving lives enough to keep the Red Cross vigilant?

No, says David Kelley, founder and senior fellow of the Objectivist Institute. He points out that money is a very effective motivator. "There's always an extra mile to go in creativity, in thinking of that solution no one has yet tried," he said.

People will work harder and longer to make sure their companies flourish and succeed, Kelley said.

To make money, Ellis has to win over more pools. He does that, he says, through diligent oversight, which includes secretly taping his lifeguards to make sure they follow his rules.

The monitoring, Ellis says, keeps the guards on their toes. "We don't consider it spying. They were given forewarning that in order to be in this lifeguard program, they were going to be held accountable," he said.

Knowing they're accountable for upholding Ellis' standards means guards must constantly scan the water with their rescue tubes always in hand. His camera caught one guard being friendly, talking to a girl, getting off the chair to sit next to her. The guard was still looking at the swimmers, but Ellis yanked his license.

And the lifeguards apparently don't mind Ellis' scrutiny. "I'm glad he's doing it because with the Red Cross, we never had anybody really come up and check up on us," one female lifeguard said.

Maria Sheba, who manages a Florida pool that hired Ellis' lifeguards, says she's happy with Ellis' guards and his scrutiny of them. 'I think it really makes a difference to them. They want to do well," she said.

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