Your business and its three kings: the client, the profit, and the society
The Role of a BUSINESS for an Entrepreneur
Running a business is challenging. Period. Launching a start-up is even harder: looking at the stats, it seems like fighting against all odds, right?
Where do you get the motivation and incentive to run a business, meet clients’ needs, and master your finances while being vigilant about the competition? Does it all boil down to the drive of the entrepreneur?
Does it come from inspiration or desperation? After all, while many entrepreneurs are motivated by a solid vision to develop and execute their “own thing“, other business owners consider it a practical option to earn their living.
The Role of a BUSINESS for Society
Let’s take a step back and look at the overall economic environment. A business is not only relevant for a single entrepreneur.
Companies are the backbone of national economies:
- They deliver goods and services to the market, ultimately improving the quality of life of their client base.
- They are the primary source for job creation: governments and international agencies monitor the business sector’s health status, and when possible, they try to support it.
- They are an essential source of revenue for the government (taxes).
- They contribute to the overall economic development of society.
Overall, stakeholders strongly desire the development and growth of a business. Entrepreneurs must recognise the social importance of their venture and be aware of the government and society’s increasing expectations. While these factors are extraordinary and clearly describe a business’s valuable role and potential positive impact, it raises new challenges for entrepreneurs.
The Business and its three kings
For its viability and sustainability, the entrepreneur has the responsibility to focus on these three aspects:
1) efficiently and effectively deliver value to the client by providing solutions to their needs (client is king). There is no business without a client and proper delivery of value. In business, you can easily hear that it exists only one God: the client.
On the importance of delivering value to clients, Netflix co-founder Mark Randolph once shared an anecdote:
“Nothing matters if the dogs don’t eat the dog food.” I had that phrase taped to my monitor for years to remind me that even the best marketing wouldn’t compensate for a substandard product. Because you know what shouts louder than advertising? Having the product actually be great”.
2) generate positive cash flow and share an appropriate value (return) with the shareholders to justify the risk taken by the investments (cash is king). If the business is not profitable, it is not sustainable.
3) consider the rules, regulations and impact on the society and environment (society is king).
3.1 Does the business play by the rules (compliance)?
3.2 Does the business provide extra value Sustainably and Responsibly?
Ultimately, a modern business must meet and “balance” its intrinsic functional needs, the needs of its direct clients, and those of society.
Are you doing the same right now?
Until next time, Sweat Your Assets!