I used to think I didn’t understand the motivation of for-profit companies, but now I think I understand it even less. If part of what makes a company ‘visionary’ is its pursuit of varied goals and a ideals, then what’s the point of being for-profit? I understand that making money is important for the continued existence of a company, for it to invest in its development, guiding, and for it to pursue its main purpose while maintaining its foundational principles, but don’t non-profits also do this? And aren’t non-profits even better positioned to re-invest any profit rather than having to give it away? If the point is to get initial investment funds, wouldn’t the leaders of a company want to buy out the shareholders whose sole interest is continued interest? I didn’t study business and have always viewed money and simply a means to an end, so I’m probably missing something. But then Packard said “Profit is not the proper end and aim of managements–it is what makes all of the proper ends and aim possible” so maybe I’m not. I realize there are probably a number of accounting/practical differences between the two so I wonder what goes into the calculation of being either. Anyway, if a for-profit structure was imposed upon me I think I’d try to keep shareholder influence to a minimum at most.
I liked this formula, where core values are “a sound set of [authentic] beliefs on which it premises all its policies and actions”, and purpose is “the set of fundamental reasons for a company’s existence beyond just making money”:
Core Ideology = Core Values + Purpose
Chapter 4 expanded on the book’s core thesis, that visionary companies “preserve the core” while they simultaneously “stimulate progress.” They explain “A visionary company protects its core ideology, yet all the specific manifestations of its core ideology must be open for change and evolution.” I couldn’t help but think these qualities could define a person as easily as an organization, and so this made a lot of intuitive sense.