A business that makes nothing but money is a poor business – Henry Ford
Roughly defined, a business is a repeatable process that
- Creates and delivers something of value
- That other people want or need
- At a price, they are willing to Pay for
- In a way that satisfies the customer’s needs and expectations
- So that the business brings enough profit to make it worthwhile for the owners to continue operation
Take any of these factors away and you don’t have a business.
A venture that doesn’t create value for others is a hobby. a venture that doesn’t attract attention is a flop. a venture that doesn’t sell the value it creates is a non-profit. a venture that doesn’t deliver what it promises is a scam. a venture that doesn’t bring in enough money to keep operating will eventually close.
At the core, every business is fundamentally a collection of five different interconnected processes, each of which flows into the next.
- VALUE CREATION- Discovering what people want or need and then creating them
- MARKETING- Attracting attention and creating demand for what you have created
- SALES- Turning prospective customers into paying customers
- VALUE DELIVERY- Giving your customers what you have promised and ensuring that they are satisfied
- FINANCE- Bringing in enough money to keep going and make your effort worthwhile