Having Profit As First Priority Can Kill Your Company

Matthew Gustin

Published by Matthew Gustin


1 year ago

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I’ve noticed that most companies get too comfortable when they end up finding themselves at the top of the game. Even though they keep working as hard as before, something changes. They crumble under the pressure of shareholders and start focusing too much on revenue.

Don’t get me wrong. I firmly believe that a company should be profitable but ask yourself why do you want to be profitable?

“We don’t build services to make money, we make money to build better services.”

– Facebook’s Little Redbook

Facebook's Little Red Book

The Why

Why

Why does your company exist? By “why” I mean the purpose, your drive. Though question isn’t it? Everyone knows what they do but very few people know why they do it. It’s necessary to know why you do what you do, because it actually affects the way you act and handle things. You don’t believe me?

Imagine that someone you love is very sick and they need $10,000 every month for treatment. Neither you nor he or she have enough money, but at least you are the one of the two who can work. You eventually find a job that is able to pay the treatment of your dearest but here’s the kicker: You work 10 hours a day and only have one weekend every month. Because you love the person who’s sick, you’ll most probably do the job and endure it until that person has fully recovered. Right after recovering, you would quit that job, because you would have lost the reason that had driven you this whole time. You won’t even think of sacrificing yourself like that if you don’t have a why that’s good enough for you.

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Money Isn’t A Goal It’s A Result

Knowing the reason why your organisation exists can make a huge difference. Apple is one of the best examples in this case. Remember when Apple started to make waves in the computer industry? They hired John Sculley, shortly afterwards fired Steve Jobs and started focusing on revenue and profit alone. They almost had to file for bankruptcy if it weren’t for Steve Jobs, who later came back and turned everything around.

But what did Jobs do differently than the others? Jobs knew why Apple exists and took actions according to the purpose of Apple’s existence. Simon Sinek (author, speaker, and consultant, who writes on leadership and management) says:

Here’s how Apple actually communicates. “Everything we do, we believe in challenging the status quo.We believe in thinking differently. “

Jobs actually never cared about money, but he always cared about the “why” Apple stood for and that’s actually what made Apple one of the most valuable companies in the world. If Jobs focused his whole attention on profit, he would end up focusing in producing and selling more products.  The result of that action would be profit but only in the short term.

The thing that keeps a company alive is innovation. In order to be innovative a company must have a strong reason for it’s existence. The why in your company must guide, motivate you and your team to produce better services and products and not to make more money. Money should not be your primary goal because it’s only an outcome of what you do.

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Having Profit As First Priority Can Kill Your Company

Share on Facebook
Share on Twitter
Share on Google+
Share on LinkedIn
+

I’ve noticed that most companies get too comfortable when they end up finding themselves at the top of the game. Even though they keep working as hard as before, something changes. They crumble under the pressure of shareholders and start focusing too much on revenue.

Don’t get me wrong. I firmly believe that a company should be profitable but ask yourself why do you want to be profitable?

“We don’t build services to make money, we make money to build better services.”

– Facebook’s Little Redbook

Facebook's Little Red Book

The Why

Why

Why does your company exist? By “why” I mean the purpose, your drive. Though question isn’t it? Everyone knows what they do but very few people know why they do it. It’s necessary to know why you do what you do, because it actually affects the way you act and handle things. You don’t believe me?

Imagine that someone you love is very sick and they need $10,000 every month for treatment. Neither you nor he or she have enough money, but at least you are the one of the two who can work. You eventually find a job that is able to pay the treatment of your dearest but here’s the kicker: You work 10 hours a day and only have one weekend every month. Because you love the person who’s sick, you’ll most probably do the job and endure it until that person has fully recovered. Right after recovering, you would quit that job, because you would have lost the reason that had driven you this whole time. You won’t even think of sacrificing yourself like that if you don’t have a why that’s good enough for you.

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Money Isn’t A Goal It’s A Result

Knowing the reason why your organisation exists can make a huge difference. Apple is one of the best examples in this case. Remember when Apple started to make waves in the computer industry? They hired John Sculley, shortly afterwards fired Steve Jobs and started focusing on revenue and profit alone. They almost had to file for bankruptcy if it weren’t for Steve Jobs, who later came back and turned everything around.

But what did Jobs do differently than the others? Jobs knew why Apple exists and took actions according to the purpose of Apple’s existence. Simon Sinek (author, speaker, and consultant, who writes on leadership and management) says:

Here’s how Apple actually communicates. “Everything we do, we believe in challenging the status quo.We believe in thinking differently. “

Jobs actually never cared about money, but he always cared about the “why” Apple stood for and that’s actually what made Apple one of the most valuable companies in the world. If Jobs focused his whole attention on profit, he would end up focusing in producing and selling more products.  The result of that action would be profit but only in the short term.

The thing that keeps a company alive is innovation. In order to be innovative a company must have a strong reason for it’s existence. The why in your company must guide, motivate you and your team to produce better services and products and not to make more money. Money should not be your primary goal because it’s only an outcome of what you do.

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