A Business Is An Energy Multiplier Designed To Improve The World
The purpose of an organization is not to make a profit. Peter Drucker is famous for shifting the mental model of the role of money for an organization from goal to means. The ability to make money, to buying low and selling high, does not explain the success or failure of a business. Still, businesses need money. Drucker refers to money as oxygen for an organization. An organization needs money to to live, to thrive. Drucker states that the goal of any organization is to create a customer. In his book The Practice of Management, he wrote, “The customer is the foundation of a business and keeps it in existence. He alone gives employment. To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” He wrote this in 1954. Today, user-centeredness is getting more and more acceptance as a fundament for any business. In most instances, businesses are still in infancy stages when it comes to how to integrate the idea of user-centeredness in their business. But we’re getting there.
A shift I see in the way we think about business is a transition to a more meaning-driven perspective. Most businesses that are incorporating user-centeredness into their operations still do this from the idea of profit maximization. The better you can accommodate the needs of the user, the more money you make. This is a limited view. I would even go as far as to state that this is an antiquated view of what a business is. If I take Drucker’s ideas about money being oxygen to a business one step further in the direction of more meaning, I see that money is not just oxygen but energy. If you look at things from a more meaningful, might I say spiritual point of view, the goal of a business can never be to create a customer. In the next generation of students and recent graduates, I sense a tendency towards more meaning. The focus is slowly shifting from making money to adding meaning to the world. The next generation is no longer interested in buying bullshit. So they are also no longer interested in selling bullshit. If you take putting the customer in the center one step further, it’s no longer about selling to the customer but about making the world better for the customer.
If money is energy, a business becomes an energy node. If money is energy, energy flows where the money flows. If you give money to a business, you give them energy. The success of a business depends on its ability to channel energy, to attract energy. Its ability to attract energy comes from its ability to turn this energy into meaning, into improving the world for the customer. The organization with the best idea to make the world a better place attracts the most energy, the most money. This is what a business proposition should be all about: what is our idea on how to make the world better? If you give us your energy, we will make the world better in this way. Every customer should ask themselves the following question with every payment: Would I want to live in a world where this company is wildly successful? Do I agree with the way this company wants to make the world a better place? This is how energy flows, following the money. For employees the same question holds. Working for a company is also channeling energy towards its idea to improve the world.
“This is what a business proposition should be all about: what is our idea on how to make the world better?”
A business is a vehicle to improve the world. A business is a transformer. It transforms energy into world-improvements. You can do this on an individual level. But a business is a way to organize energy so the energy can multiply. A well-run business is able to increase the energy level above that of the sum of its employees. It does that by using tools like:
- team spirit,
- service proposition,
- skill development,
- executive decisions,
- portfolio, etc.
With these tools, a business must craft an energy multiplier. Business design is about using these tools to multiply the energy that flows through the energy node that it is. Improving the performance of a business is about:
- removing energy blockades,
- about finding ways to amplify the energy of groups of people through the synergy that can come from connecting minds,
- and amplifying the energy of employees through processes, tools, training, engagement levels, etc.
The sum of all a business is, the way that customers can choose where to channel their energy, is the energy it radiates. A customer must be able to see:
- what a business produces (i.e. how they improve the world project-by-project),
- how they do it (i.e. their philosophy and approach),
- and the power of the energy-multiplier machine they have built (i.e. the buzz around a company).
Customers have a limited amount of energy to channel (i.e. money to spend) so they should want to spend it at the company that has built the most powerful energy-multiplier and aims it at the most important aspect of the world that needs improvement.
Not all customers are there yet, but the times they are a changin’.
Not all businesses are there yet, but the times they are a changin’.