There is more to business than profit
In this blogpost I will argue that business should move “from profit to purpose”. Profit follows from purpose.
Company A sells water pumps at a profit. Good pumps, good price, good profit. Company B provides clean water where it is needed.
Everybody can produce and sell good pumps and make a profit from that just like company A. In fact there are hundreds of companies that already do so. If Company A disappeared, few would notice it beyond employees, suppliers and their families. No wonder competition is tough; everybody fights for lower prices and lower costs.
However not every company can provide clean water. It takes a good pump, but it also requires finding a good spot, digging the well, distributing the water to users, getting a fair pay and constantly monitoring water quality. Providing clean water is a highly knowledge intensive business with a lot at stake because the risks and hassle from polluted water are huge.
No customers actually need pumps - what they need is clean water. Providing clean water is a purpose; selling pumps at a profit is a mere activity. No wonder profit margins for conventional pump manufacturers tend to shrink. Big money doesn’t come from doing something everybody can do. Big money comes from doing something unique and something real useful to prople. From profit to purpose.
What do you think? And what does this mean for tomorrow’s people management?
PS: In a later blogpost I will address a similar question for the public sector.




