leadership roundtable hq

The Purpose of Business

On November 27, 2008, my company, an oil service company in Trans Amadi Port Harcourt, celebrated being the first African company to be awarded BSI ISO9000 FasTracQ. At the celebration party, during the free comments session, I came out as the QA Team Leader on Documentation and defined business as “an economic venture to earn profit”. I thereby encouraged our colleagues to see that our new fleece of ISO9000 FasTracQ #1 achievement in Africa earns us profit in oil & gas generally.  I was oozing out the air of competence with my newly qualified MBA degree from a university in Port Harcourt, Southern Nigeria after my 29th birthday. After my comments, a 27year old, graduate with the same MBA from Southern Carolina University USA, rubbished my definition of business. He said that business is what pays the bills everywhere every time. I felt that he, Stephen White, an American expatriate just employed not up to a year then was wrong and arrogant to an elder and to a Nigeria MBA, perhaps because the company favours them as theirs than us Nigerians. It took another 6 months for me to realize that Steve was right, I was wrong on what Business is, perhaps the purpose of business.

the purpose of business
the purpose of business

An average Nigerian educated will define business as I did 23 years ago – a venture to make a profit; no wonder our business dies prematurely in Nigeria.

The PURPOSE, ESSENCE, original INTENT of business is to Please ITS Customers!!! Hmmmmm, “I don carry the ball into your 18 (penalty box)!” Can I score? Now, read me keenly and avidly! The purpose (ie the original intention) of business is to create and keep customers in the most cost-effective manner. Profit (as I thought pre-1998, perhaps you do now) isn’t the purpose of business. Petty traders in Ariaria Aba, Alaba Lagos, Ochanja Onitsha, Sabo Ngari Kano, etc., markets think so, but you, an entrepreneur, CEO, biz mogul, and business leader oughtn’t to think so. Profit is the OUTCOME, RESULT, EARNED EFFECT of creating and keeping a significant number of customers (neither buyers nor prospects) who yield a sufficient number of profits after all costs. Wow! Follow me.

Customers, Buyers, and Prospects

Too many businesses person don’t know who is a customer or what is a customer or how to know a customer. Quite appalling! At most, they mistake a customer for a buyer. some go too low to mistake a customer for a prospect.

On the buying side of the sale of a product/service, there are 3 human actors there: the customer, the buyer, and the prospect.

+ The prospect is one the seller is wooing to come and buy a product.

+ The buyer is one who for the first time accidentally comes in and buys. He’s also an occasional (once in a while) buyer. He’s coerced, persuaded, wooed (as you woo a woman/man) to be a customer. That’s a buyer.

+ The customer is a CUSTOM-ary buy-ER ie a traditional, REGULAR buyer, who will always come; come rain, come sun. Customer is a compound word from CUSTOM-ary and buy-ER.

$ When you have a prospect, you’re not sure if he will buy.

$ When you have a buyer, you’re not sure when next he will accidentally (miss the road and) come.

$ When you have a customer, you’re sure that once he needs your stuff, his money will enter your pocket. This is because he’ll come. Imagine you have thousands of customers, you’ll become stinkingly wealthy. That’s why you seek and advertise for Customers for a lifetime and endlessly. You know you don’t do that for prospects and buyers. Do you?

What is the Key Measure of Business Success?

The answer is CUSTOMER SATISFACTION. Every effort and activity of your business must be aimed at satisfying customers in a manner that is better than any other competitor.

What is the Measure of Customer Satisfaction?

It’s a REPEAT BUSINESS. It’s only when a customer buys from you again and again that you demonstrate that you have fulfilled the promise you made to him the first time. Every one of us in business makes spoken AND unspoken promises to Customers/Clients.

The Purpose of Business
The Purpose of Business

Selling to a satisfied customer requires one-tenth of the TIME and EXPENSE as compared to a sale to a new customer. All successful businesses rely on REPEAT BUSINESS, which is made possible by levels of CUSTOMERS’ SATISFACTION. This dovetails to long-term profitability, which answers to RECOMMENDATIONS and REFERRALS.

My message:

be properly focused. Don’t focus on the wrong thing with your hands, when you’re thinking on another in your mind. When you make, serve, and retain CUSTOMERS, they generate revenue (income), and income produces profits (by your efficient management of resources) for you, Profit is what generates wealth for you. Wealth is what you enjoy, pose with, and do guy. [Observe the flow/hierarchy.]

Help? Inquiry? Get his books?

Click HERE to Contact Dr Mike.

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Dr Mike Ihezuo

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Mike is a leader and leader’s developer, a speaker, an author and a prolific writer, a researcher and consultant. He invests life, time, energy, resources and money to empowering organizations desiring upward dive to top performance and individuals desirous of fulfilling their destinies, discovering purpose and seeking success towards significance. Mike, as a life coach, team builder, conflict resolutions exponent, motivational maestro, negotiation experts, corporate strategist, an entrepreneur and entrepreneurial developer, invites you to this LeadershipRoundTableHQ. Let’s talk and discuss so as to learn and GROW…

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