Why profit is counterintuitive for businesses

//Why profit is counterintuitive for businesses

Why profit is counterintuitive for businesses

By | 2016-02-02T21:31:42+01:00 November 28th, 2013|Musings|0 Comments

people not profitsThe case for People not Profits

Profit may be a reliable measure for success however as an objective for business it’s counterintuitive

Lately it seems as if everyone wants to start up his or her own business. Friends from far and near are ringing me with all sorts of questions. How do I start, when do I start, what do I need to start and the list goes on and on.

When meeting with start-up newbies my first question is always, ‘why do you want to start a business?’ I generally get one of two answers as listed below:

A) I want to make lots of money
B) I want to serve and add value to the world

Most people reply with A – they want to make lots of money.

Such a shame!

Starting off with profit as the goal may not reap the desired outcome. And based on my experience, the journey of money chasing isn’t an easy one! If only the newbie could realize that most successful business owners start by asking:

“How can I best serve or add value to the world?”

Making a profit is a byproduct of serving and adding value.

James Collins, a company success researcher for over 20 years, discovered that companies that set out to max profits end up being less profitable than those with more visionary goals.

And Peter Drucker, a management guru, explained that “the purpose of a business is to create a customer.” Profit is the reward that markets provide to those that succeed in this purpose.

Let me end this post with the following quote by Victor Frankl:

“Don’t aim for success – the more you aim at it and make it a target, the more you are going to miss it. For success, like happiness, cannot be pursued; it must ensue, and it only dose so as the unintended side-effect of one’s dedication to a cause greater than oneself or as the by-product of one’s surrender to a person other than oneself. Happiness must happen, and the same holds for success; you have to let happen by not caring about it.”

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