Business is simple really – not easy – but simple. You create a product or service that offers value to a market, and that market acknowledges its value by purchasing it. If your product (or service) is not purchased, then you have to look at whether or how much the product is valued. In a way, customers are voters. With each purchase, the customer is voting for whether they like your product and/or your brand. You get lots of votes and you stay in business; you poll poorly and you are out of business.
Okay, so this is looking at business far too simplistically. There are many factors that go into a business working or not working. Indeed, you may well have a good product but haven’t figured out a way of marketing it or producing it at a cost that fulfills profit goals and a market’s price point. But that aside, let’s roll with our metaphor of the customer as voter.
This mechanism of voting/purchasing is based on a value exchange between the provider and the market. The business owner’s job is to be in constant relationship with the market to know whether or to what extent that relationship is healthy and there is a value exchange. If the relationship is healthy and the market perceives a fair value exchange, you are doing pretty well. Sales is a very clear feedback loop on how your business is tracking.
What about non-profits?
Small (and big) business owners know this and track sales constantly. It is like a doctor checking the businesses pulse (okay, no more metaphors). But what about the non-profit ‘market’? Read more