Truth About Business

Bahram R. Shahmardaan, PhD


To create and sustain any business we need to have the units of production commonly categorized as Manpower, Materials, Management and Money. All these units of production are utilized to develop and deliver products and/or services to people.

Many people have the impression that the main purpose of business is making money. In fact many businesspersons think that the only purpose of business is to make a profit and that business is all about money and making more of it.

The truth and reality of business are very different. Business has very little to do with money. True, money is indeed one of the major units of production and facilitates economic transactions. But money without people and markets cannot create and sustain business. Even if you have all the units of production, without people you cannot have the markets in which to sell the products and services of the business.

The main purpose of business is to serve people. Because this is so important, it is worth repeating. Business has very little to do with money. Business has everything to do with people. Even if you have all the money in the world but no people to serve, you cannot have a business. But even if we do not have any money we can deliver goods and services to people and thus create a business and make it grow.

So the main focus of a business should not be to make a profit. The main focus of a business should be to serve the people by delivering goods and services to them in the most efficient manner. Any business that does this will naturally become profitable. Profit is a natural outcome of efficiently producing goods and services and delivering them to the people who need them in a timely fashion.

How many business owners think along these lines? How many business managers practice it?
More often than not businessmen are so profit oriented that in order to make a profit they cut corners and sacrifice quality. They will be able to get away with poor quality and service in a closed economy in which there is very little if any competition and demand outstrips supply.

The world is becoming smaller with each passing day. In order to compete in a Global economy in which we have to compete with the rest of the world, the surest way to ensure success is to focus on the real purpose of business, which is to serve people. To do that we have to deliver the best possible product and/or service at the lowest possible price. This can only be achieved if we take pride in the quality of the products and service we deliver. To do so we have to work with integrity and self-respect and treat our employees and customers with the dignity and respect they deserve. The natural result of this conduct is efficiency and the by-product of that will be profit.

Bahram R. Shahmardaan, PhD