Published in the Independence Daily Reporter, February 22, 2017
Most of us have heard it before. “What’s the number one reason for being in business?” If you’ve been in any business class for the last 100 years and even many entrepreneurship classes today, the expected answer is to “To make a profit.” That should not be the number one reason to be in business. When I say this, I am often misunderstood. Profit is essential. Business can’t survive without it. Even “not-for-profit” organizations have to have a certain amount of profit to remain in existence. Non-profit is a status for income tax purposes.
The unhealthy over-emphasis on profit likely began in the late 19th century with the industrial barons of the day desiring profit without regard for the welfare of the people doing the work. Also of little regard were any thoughts of good stewardship regarding the natural resources required for the output of the industrial revolution. Sometime around the advent of the 20th century, business schools were created to produce the managers of industrial companies and those managers were taught that profit is the number one motive. One unexpected (maybe not unexpected, but disregarded) consequence of this emphasis was the development of the labor unions in an attempt to negotiate respect from the corporations. Many of our natural resources have suffered from depletion and/or pollution. Profit as the number one motive above all else opens a door for greed and corruption.
Through all of this, there was little regard for the needs of the consumer. They were expected to purchase the output of business and be happy with whatever they got regardless of quality or lack thereof. Remember the term “planned obsolescence” we used to use about American-made cars? Remember the time in the 1980’s when the American car companies were nearly crushed to death by Japanese car companies? The Japanese cars would last for two to three hundred thousand miles instead of the eighty thousand miles that had been built in to the American models.
Today, many of us are moving into a new world of business. In this world, the number one goal is to provide products and services so good that customers are happy to pay enough for them to provide a healthy profit. This is the message we should be conveying to entrepreneurs and business majors today. In our global entrepreneurial economy, someone, somewhere, is going to be striving to provide higher quality. In our Entrepreneurial Mindset class, we strive to create the entrepreneurial thinking processes that emphasize service and innovation to provide the best solutions for customers. Once that thought process is in place, figuring out how much to charge to make a profit is easy. People don’t mind the price if the solution is exceptional.
This concept of exceptional service as the primary motive can also be applied to traditionally not-for-profit entities like local, state and national governments. People would not object to paying their taxes so much if they felt like they were getting exceptional services. What would it be like to go into a city hall, courthouse or other government office and be treated like a valued customer?
All of us could benefit from an entrepreneurial mindset that emphasizes great service as the primary motive. Our customers and constituents would be much happier, whether paying at the cash register or paying their taxes.
Jim Correll is the director at Fab Lab ICC at Independence Community College. He can be reached at (620) 252-5349 or by email at jcorrell@indycc.edu.
Jim Correll 