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Interacting with many business owners, I occasionally meet people who say, “The goal of my company is to make money, increase assets and the company’s market value.” These people have no idea that they are not talking about the company’s goals, but about their personal ones. The owner has a goal of increasing the company’s value and wants his or her “baby” to continually grow. This point of view could be compared to that of a father who wants his child’s only goal to be to serve his parent. This is a completely u
Once, during a workshop, the owner of a roofing materials manufacturing and retailing business approached me. His company employed around fifty people. They manufactured copper shingles, gutters, and other parts for copper roofing. Our conversation went as follows.
“Our company manufactures a good product and our customers are happy. It is certainly not a cheap product, but the customers who know us usually thank us for our services. But there’s one issue I still can’t understand. When I start my workday, I’m full of energy. I meet with the customers and manage my employees. The window of my office faces the sales department, and since I usually arrive at the office earlier than everybody else, I get to observe my employees as they come in. You know, we try to take care of our employees. Their salaries are high and the working conditions are good, but when they get to work, they look like they have been working hard all night long and can’t wait to finally get some rest. They barely move. And unless they get enough coffee, they ca
“What is the main goal of your business?” I asked him.
“What goal? It is to make money for me, of course!”
“Imagine you just joined a good company as a salesperson. During the orientation period, you are told, ‘The goal of our company is to make another million dollars for the owner!’ Would that inspire you?”
“No. I get it,” he said after giving it some thought.
When the company owner confuses his personal goals with the goals of the company, he creates goals for the company that do not motivate his employees. Imagine a company where during corporate events it is a
Think big. Don't waste your time on pseudogoals like “making more money,” “benefiting everybody,” or even “becoming number one in the industry.” Assess what the company can realistically achieve in the long run. If you manufacture furniture, maybe your goal would be “providing comfort and design for people’s lives.” If you are a grocery wholesaler, perhaps it would be “creating high-quality living standards for a wide range of people by providing a fresh and premium-quality range of grocery items.” Of course, these goals need to reflect your own aspirations and talents. One owner will start a company to bring the latest technology to the market. Another owner will start a company to provide satisfying and cheerful service. Ever since he started walking, my nephew, Vasiliy, has amazed the people around him with one particular habit: He ca
Trying to set up a goal based on the individual goals of the group members is also a common mistake made by business owners. The owner needs to be aware that as the founder as well as a member of the group, he performs a very specific function: He forms the goal for the entire group. An example of this kind of mistake would be to say, “Our company’s goal is to provide customers with a quality product, increase owners’ equity, and create a decent standard of living for our employees.” This is not a goal. It is merely an attempt to please everyone who has something to do with the company—employees, owners, and customers. And this attempt to please is the exact opposite of the manifestation of individuality. A problem with such goal formation is that people are not so naïve as to believe that this is really the group’s goal.
I am genuinely surprised by what results when some not very clever consultants’ brainstorm about the main goal and purpose of a company with its top management team. They come up with these monstrous ideas that do not inspire anyone—not managers, owners, or employees. Have some fun by reading the goals and mission statements of some of these various companies online.
Occasionally, I help owners to create mission statements for their companies. I first ask them questions that relate to the purpose of the company. I ask what the initial business idea was and whether it had any competitive advantage that distinguished the company from its competitors. I ask the owner to describe the company’s operations in a few words. When the purpose is clear, I help him or her state the main goal by asking questions about what would change in the company’s external environment if it successfully carried out its purpose. Why do I start with the purpose? I do this because the purpose is more concrete to people, as it will determine the company’s course of action. The main goal, however, is less apparent, though in essence it is predetermined by the purpose.
When you create the main goal of the group, don't think about whether employees will like it. The most important thing it should do is inspire. Look around at the leaders of some outstanding companies. As a rule, they dedicate their whole lives to doing their favorite job. They have enough courage to do what inspires them. And they create main goals that attract the right people to their companies and encourage them to stay.
Chapter 5. The Pursuit of Money
The business world is brainwashed by the idea that the goal of any business is to make money. Of course, the people who made this idea popular are not very smart; they do not understand anything about money at all. Money is just a medium of exchange. The amount of money a company makes depends on how useful its products or services are, and how widely available these products or services are. Behind every product, there is a particular person’s dream, as well as a goal that inspires an entire team to overcome any obstacles along the way to creating the product. Long before Mark Zuckerberg became a billionaire, he refused Microsoft’s generous offer to buy the program he’d developed. The reason was simple. When he came up with the idea of Facebook, he was thinking about creating a communication and social-networking platform for university students, not about columns of numbers on a financial statement.