I once got into a heated discussion with a former boss by stating that the first priority of any business is making a profit. He claimed that prioritizing profit skews your thinking and leads companies down dark paths. I still beg to differ.
Here’s an analogy: As human beings, our first priority is to breathe. If we stop, we die. Profit is the breath of business — without profit, the business dies.
Fortunately, as humans we don’t need to work very hard at breathing (well, most of us, anyway). Turning a profit, on the other hand, is difficult.
Many people confuse the need for profit with the motivations, values, strategies and tactics we employ to earn that profit.
There’s a basic formula here that somehow gets obfuscated way too often…
- Our company needs to turn a profit or we all go home.
- What goods, services and value do we deliver to earn that profit?
- How do we create, deliver and support those services?
- How do we communicate with our market to let them know?
Steps 2, 3 and 4 are very malleable. Step 1? Not so much.
The challenge, of course, is defining and aligning steps 2, 3 and 4 so that they support step 1 — without step 1 stepping all over 2, 3 and 4.
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