Million Dollar Question

What is the purpose of business? If you were to ask a business professional “what is the secret ingredient as to why they were successful or unsuccessful?” you would get a number of different responses, including marketing and innovation. I know this, because I am a business consultant who specializes in developing professionals to become more productive and profitable through strategic planning. Although I concur that “two purposes of business are marketing and innovation”, I respectfully disagree that they are among the top of the list.

Without a product or service a business does not have anything to market and sell. Without a plan, innovation is only a word that describes forward thinking, but does not address the goal of every business which is to earn a profit or operate within budget. The question “what is the purpose of business?” is simple for me to explain with my experiences in successfully starting, developing, and selling several businesses. You must have something to sell, whether it is a product or a service; and you must have a plan to develop the process to maximize profitability.

The perception that businesses are much more complicated today than they have been in the past, in my opinion is completely false. I believe that we all have the same purpose. The purpose of every business is to sell a product or service in the most productive and efficient way possible to earn a profit. Any time that you add innovation to this simple formula all you have done is confuse your business for an empire, and marketing is the only way to overshadow the underlying issues.

I believe that all businesses should start with written goals. The first goal should be incorporated into the vision statement, which is to be profitable. In order to increase profitability a business must first systematically improve production and the efficiencies within production. I do not feel that marketing is a key factor in the way that you develop a product; rather marketing is a way to create warm leads in order to sell a product or service.

What I have experienced in my career thus far is that we all have a plan, but many times do not have it in writing. I have found that many businesses hide behind clichés, gimmicks, and customer service, but lose sight of what it is that they are actually selling. When meeting with my client’s for the first time, my first question to them is this: “what is it that you sell?” I rarely get the actual product, but rather the “innovative idea” or the best “marketing slogan”. Profitability is a direct result of the productivity within all businesses, marketing and innovation is only part of the plan.