Whenever I speak in front of a classroom of students at a business school, I always pose the questions “What is business?”
Most people who answer reply with uncertainty, and a few words about finance, or trade. They aren’t wrong, however, I find it to be humorous that everyone in the class is attending “Business School,” no one has been given a definition of what business is!
Feels like an important over-sight… I look forward to a university defining it at some point. Until then - I’ll fill in.
I am technically a business man, I do business. My Dad is a business man. My grandfather is a business man. And one day I woke up and asked “Well… what the hell is business?”
Business is the act of making promises, and delivering on those promises. Those successful in business have figured out how to scale those promises into services and products better than anyone else.
It’s simple, you make a promise and keep to the promise, you get rewarded. You break the promise, it doesn’t work out as well.
Some people reading this may think, “Who cares? The definition doesn’t really matter because everyone inherently understands what business is, and what a business man is.”
In our world. In the world of business, words matter. Specifics around the meaning of words matter a ton, especially when forming a deal.
I remember going to my Dad and having a casual conversation around an investment and in the middle of the conversation I said:
“So I gave them the money, and…”
I’m not sure what I was going to say, but my Dad pounced on my error and cut me off.
“You INVESTED the money.”
Be careful the words you use, because they have meaning. And to me, business is the act of making promises and delivering on those promises.
Words matter in the world of making promises. So go make some promises and do some business today!!!
Here’s another blog I wrote a long time ago about “Value vs worth” where definitions matter a lot.
Peter Drucker assertion that purpose of a firm is CREATE and keep a customer. This can involve at least 3-4 phases ... value IDENTIFICATION, creation, delivery and extraction. The value can take different economic patterns, typically I would ask founders is what you're selling asprin (analgesiac to resolve pain-point), vitamin (nice to have), vaccine (preventative) or insulin (regulator ... sometimes public good). You can innovate on 3 dimensions of product / market / business model reconfiguring resources to deliver your marketing 'promise'.
I am delivering on podcast episodes this week.