The Purpose of Business
Peter Drucker noted that the organization is an abstraction—a concept we use to denote a group of knowledge workers operating towards a single purpose: To produce customers in the outside world.
True organizational results are achieved on the “outside” because everything “inside” is related to effort and cost, not profit. These outside results positively impact your customers.
From this perspective we can better understand the need for clear direction—to an ultimate vision—within any enterprise. Without a clear end picture, effort and cost will spiral upward as the company’s employees lack focus and direction.
As a leader, your job is to provide a clear vision for how your business will serve your customers better than anyone else. Companies with this obsessive focus win. They build extraordinary internal cultures that attract people who want to join in their mission.
A few examples:
- Netflix effectively dismantled Blockbuster (and fought off Wal-Mart) with laser focus on serving their customers with high integrity and dependable service.
- The Motley Fools has become an oasis of honest financial commentary in a sea of Wall Street spinsters and celebrity commentators.
- Zappos built a legion of loyal shoppers by delivering world-class customer service 24/7, 365 days a year with free shipping both ways.
The single purpose of a business is to create a customer. Cultivate a culture that respects and lives this reality and you’ll join the ranks of strong brands that build sustainable, profitable enterprises.
Related posts:
Southwest Airlines has all of my business. They’ve created a very loyal customer in me. I don’t even care about my points from company “x” anymore.
Like the companies mentioned above, Southwest is obsessed with serving their customers — as well as serving their employees! People who work at Soutwest LOVE working for Southwest.