Philosophy Tuesday

“A company’s purpose is to make money.”

We need, I strongly assert, to stop saying/repeating this.  Because it is false.

Which I think, deep down, we all know.  But it’s weird, ‘cuz it kinda feels true, doesn’t it?  It’s a classic example of both a “false opposite” and an “adjacent mistruth” operating in harmony:  A company that continually loses money isn’t going to be in business for very long* – that’s the true part.  The false opposite is that a company has to make loads of profit to remain in business.  Similarly, to avoid losing money, a company has to think about its cash flow.  Which is fair, but the adjacent mistruth that arises is that therefore the company must think about, and almost only about, maximizing its profit at every turn.  Put those two together and it has got the veneer of veracity.  One that is further burnished by repetition.  We hear this phrase over and over so often that it feels true just through recurrence and agreement.

And boom, there it is.  We get companies that do just that, and we, perhaps unwittingly, encourage it.

However, despite this truthiness it is a falsehood.

A company’s purpose is to produce a good or service that is of value to the community while earning those who provide that good or service a decent living.

That’s it.  That’s what a company ought to be aimed towards.

If a company is in business for 50 years and breaks even every single year while providing a solid living for its employees, it’s doing great.  It may not be “crushing the competition” or “growing by leaps and bounds” or “earning a 50% profit” or “making it’s owner insanely rich” or “producing amazing shareholder value.”  But it’s been around for 50 years, providing something worthwhile that has it stay around for 50 years, all the while with employees living mighty fine lives.

A company need not overcharge its customers so it can pocket the difference.  Or underpay and overwork its employees to pocket the difference.  Or offset costs into the community to pocket the difference.  Or harm the environment to pocket the difference.  Or make detrimental and injurious products to pocket the difference.  It need not impoverish us all, fleecing us to further line the pockets of a select few.

Companies are about people making vital and fun and really nifty stuff for each other so that we can all live and thrive together.

And that’s what we need to be saying.

 

* Usually – companies/rackets like Uber notwithstanding.

One thought on “Philosophy Tuesday

  1. Earthship Captain August 4, 2021 / 15:15

    This totally reminded me of Simon Sinek’s talk about the purpose of a company is not to make money.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s