It is often said that business owners must maximize shareholder and/or stakeholder (i.e. those who can impact or be impacted by the company’s actions, objectives and policies) value.
The only meaningful way to know if a business is great or not is in how much value (i.e. profit) is created. Or so goes the accepted wisdom of business.
The purpose of business, gurus say, is to make money — the more the better. As long as you create more value everything is going to be hunky dory.
But in the case of startups and small business, we totally miss the boat if profit and cash is the ultimate aim and only measure of success.
Profit is not the sole point of business any more than breathing air is the singular point of being alive. We need to breath air, good clean abundant air, but it’s not what we’re here for. It’s the same with business, we need to make a profit, but it’s not the reason our business exists.
Do you want ribbons with that bunch?
For example, nobody can deny that if you are going to sell food, McDonald’s has created a pretty slick and efficient way to do so.
“For the last 75 years, McDonald’s has been serving up hamburgers to customers worldwide. They now serve 68 million customers a day, in 119 countries across more than 35,000 franchises. The company was able to scale its business by asking one simple question ‘Would you like fries with that?’ – which has not only contributed to the growth of McDonald’s across the world but also has become an iconic catchphrase on its own.” – TNW
As a matter of fact, I’d hazard a guess that if you wanted to make money from selling food, there is no more efficient way to do so than to build a McDonald’s. And similarly if you wanted to make money from plumbing, from pet care or from floristry, you could take the McDonald’s playbook, apply it to your floristry business and make lots of money.
But I think we’d all agree that it would be a sad world in which all restaurants were built on a McDonald’s model and equally I’d hate to live in a world in which all florists were staffed by teenagers trained to ask me if I wanted to supersize my bunch or if I wanted ribbons with that bunch.
As long as it doesn’t cost me any money
The problem with making profit the highest measure of success is that everything else we might consider to be important in life has to become a second order consideration.
For instance, we might like to provide a healthy work environment for our staff, as long as it doesn’t cost us any money. Or we might want to ensure we don’t have a negative impact on the environment, as long as it doesn’t cost us any money. Or we might be passionate about the quality of our product, as long as it doesn’t cost us any money.
Building a business is one of the most creative things that humans can ever do, second only to the creativity of bringing a baby into the world and helping it become a well-adjusted happy adult. But just like the joy of having and raising children is not in how much money you earn from it, nor is the joy of building a business in the profit it generates.
Money is an enabler
'When we start businesses solely to make money, it’s a massive exercise in missing the point.'Click To Tweet
Let me introduce you to the concept of fun in business. This concept is derived from a book I’ve written called “The Ten Truths for Making Business Fun”. Essentially, business is fun when:
you’re making money
your staff is engaged, motivated, and efficient
customers are raving fans
your work has a positive impact on the community and environment
you’re proud of the products or services you provide
it affords you the kind of balance and lifestyle that is important to you
These are the pillars that the concept of having “fun in business” rests on. When these pillars are strong your business will be fun. Similarly, when the pillars are wobbly the platform might fall and business may not be fun.
As you can see, money is just one of the variables in this equation. So, by making “fun in business” your ultimate measure of success, you will build a much different kind of business, a business that sustains you and everyone it touches for years to come.
If you start to focus on making business fun, instead of making more money, your business (and your life) will never be the same again… I promise you.
This article has been edited and condensed.
Roland Hanekroot, founder of New Perspectives Business Coaching, is a business coach, mentor, author and speaker who works with small business owners to Make Business Fun again and to build businesses that sustain them for years to come. Connect with @coachbusiness on Twitter.