This week I had the opportunity to read the article from Charles Handy from the Harvard Business School. I liked his approach to the question: What´s a business for? because sometimes we as entrepreneurs just start a business thinking about money and profit, to became rich and to have a very comfortable life, but we usually don´t think about the people we will need to arrive where we want to.
He said: "Markets rely on rules and laws, but those rules and laws in turn depend on truth and trust.Conceal truth or erode trust, and the game becomes so unreliable that no one will want to play." Integrity and virtue in business is vital to be Independent for the creation of our own wealth. If we are a "bad" company nobody will trust us, and will invest in another things, maybe in their houses or under their beds, so the economy would collapse.
What´s the real justification for the existence of a business? I have to confess that I always thought the purpose of a business was PROFIT! The good think is that I was not totally wrong, profit makes part to succeed in business, but its is not the only thing. Charles Handy teaches us: "The purpose of a business, in other words, is not to make a profit, full stop.It is to make a profit so that the business can do something more or better.That “something”becomes the real justification for the business." The profit will allow the business survive to make something different and change the people lives. The other problem about business is the way workers are treated, sometimes the workers are treated as property of the owner of the companies. It remembers me the time when we had slavery in the world, and we can learn from history what happen when we treat other people like slaves, it is not a good end. He says: "A good business is a community with a purpose,and a community is not something to be “owned.”
To succeed, the business must have a purpose. The leader has the responsibility to involve this community in the company´s purpose having ideas that scale, so this way everybody will succeed together or fail together. There is no doubt that the modern business have the purpose to improve people lives, give them purpose, create wealth and make a better community for the people. As entrepreneurs we need to think more in people than in profit, so this way we will became change-makers and the profit will be consequence.
He said: "Markets rely on rules and laws, but those rules and laws in turn depend on truth and trust.Conceal truth or erode trust, and the game becomes so unreliable that no one will want to play." Integrity and virtue in business is vital to be Independent for the creation of our own wealth. If we are a "bad" company nobody will trust us, and will invest in another things, maybe in their houses or under their beds, so the economy would collapse.
What´s the real justification for the existence of a business? I have to confess that I always thought the purpose of a business was PROFIT! The good think is that I was not totally wrong, profit makes part to succeed in business, but its is not the only thing. Charles Handy teaches us: "The purpose of a business, in other words, is not to make a profit, full stop.It is to make a profit so that the business can do something more or better.That “something”becomes the real justification for the business." The profit will allow the business survive to make something different and change the people lives. The other problem about business is the way workers are treated, sometimes the workers are treated as property of the owner of the companies. It remembers me the time when we had slavery in the world, and we can learn from history what happen when we treat other people like slaves, it is not a good end. He says: "A good business is a community with a purpose,and a community is not something to be “owned.”
To succeed, the business must have a purpose. The leader has the responsibility to involve this community in the company´s purpose having ideas that scale, so this way everybody will succeed together or fail together. There is no doubt that the modern business have the purpose to improve people lives, give them purpose, create wealth and make a better community for the people. As entrepreneurs we need to think more in people than in profit, so this way we will became change-makers and the profit will be consequence.
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