Profit: Organizational Viability Considerations and Recommendations
A business is formed primarily to profit its founders and employees. As part of the 3BL, profit is a co-equal consideration with business impacts on the planet and people. However, profit is the only of the three that is essential to the operation of the business; if the business is not making profit, then the next-best-case scenario is that the business is breaking even. That means that the business is stagnant and unable to invest in expansion and development without cutting jobs or reducing product costs. And of course, the worst case scenario is that the business is losing money, and its days are numbered. Therefore, profit is the only one of the 3BLs that needs to be maintained in order to keep the business running. A business can ignore its commitments to people and the planet and still continue operations. However, it is necessary for the business to maintain the other components of the 3BL in order to be truly successful.
Maintenance of profit is a balancing act. The business must ensure that corporate profit drawn from the community balances the profits that the community draws from the corporation. In other words, the company must be a benefit to the community as much as the community is a benefit to the company. The biggest benefit that a company provides to a community comes in the form of jobs and employment; a company hires members of a community and pays them a decent wage, which in turn drives economic growth in the community. This benefit must be in balance with the benefit that the company gets from the workers; in other words, if a company benefits from productive, skilled employees and makes very large profits, the employees would be ...
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...dations of a business, and without managing them effectively, a business can find itself falling behind in the marketplace. The Triple Bottom Line creates a three-tiered focus for the company to work towards. If a company commits to maintaining the Triple Bottom Line, then the company makes a commitment to remain viable and in-touch with the ever-changing marketplace.
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The word profit is used in many different contexts such as day to day business transactions to a discussion about a country’s Gross Domestic Product (GDP). Yet, what is profit and what kind of social implications are there when this is one of the main focuses within our economy? The pursuit of profit is one of the underlying features that make up our capitalist system. It sparks that competitive drive among businesses and corporations. The simple definition of profit is “when a ...
Zsolnai, L. (2011). Environmental ethics for business sustainability. International Journal of Social Economics, 38(11), 892-899. doi: 10.1108/03068291111171397
Staying a headed of these issues allows for companies to be efficient, profitable and remain
Shum, P. K., & Yam, S. L. 2011. Ethics and law: Guiding the invisible hand to correct corporate social responsibility externalities. Journal of Business Ethics, 98, 549-571.
There are four key resources that can be broken down into categories; human, financial, physical and intellectual (Martin, 2015). Effective key activities are vital pieces of the puzzle that help the business deliver its value propositions ("20 Minute Business Plan: Business Model Canvas Made Easy," n.d.). These activities need to be carried out so the product or service that was promised can be delivered ("20 Minute Business Plan: Business Model Canvas Made Easy," n.d.). These particular activities coincide with the revenue stream building block, which is a procedure a company follows to get their chosen customer segments to purchase the service or product. A revenue stream can be generated seven ways; an asset sale, a usage fee, a subscription fee, lending/leasing/renting, licensing, a brokerage fee, and finally advertising (Martin,
Most companies are profit oriented. Companies survive and live on profit. Even governmental institutions, NGO's and NPO's are profit oriented, what they do with profit is different though. Saying this means that companies seek always to be at a position where profit is maximized. As we know by now this happens when MC=MR but this is an always changing point as supply and demand are dynamic, effectively meaning that if firms get it right once they can't just do the same eternally, they still need to adapt to every market factor as a new change is a new reality all together that needs to be studied and addressed. All of these changes happen in what is called the market, where suppliers and consumers meet to reach a level that suits the interests of both parties involved.
We probably all agree that the primary objective of any business is to achieve revenue and attain a certain profit. But then here is the question that we might ask, is profit the only element that should be considered when making business decisions? In my point of view the answer is no as I will try to demonstrate throughout this paper. One quick alternative of what should be the first top priority of a business is creating a customer as Dr.Peter Drucker said. According to him “The customer is the foundation of a business and keeps it in existence. He alone gives employment. To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” (Santayana, George. Is The Tyranny Of Shareholder Value Finally Ending? )
earn from the business and shaping their way of living. For these and other reasons, it is
To start this Argument we look at the definition of business. Business is an activity that one, two or more people do to produce and circulate goods and (or) services for the well-being comfort and happiness of people and society as a whole while profit is gained.
In business the primary focus is on maximizing returns to owners or shareholders. The manner in which a business conducts itself while attempting to make its profit can be considered ethical or not. For instance, a business that has a positive sense of social responsibility will make some effort to have a positive impact on society, contributing to the welfare of the community in which it operates in some way or another. Unethical practice in business could include the converse of this, where a business is solely concerned about its profit and does not attempt to mitigate the impact of its operations in that society. For example, a mining exploration company that does not attempt to ease discomfort and inconvenience of the people that are displaced by its operations could be considered unethical.
Reed, B. (2011). The Business of Social Responsibility. Retrieved from Dollars and Sense Real World Economics: http://www.dollarsandsense.org/archives/1998/0598reed.html
...sively thinking about the bottom line rather than thinking about the betterment of the world as whole. Low costs and high profitability are important, but no company wants to be labeled as “THAT company that exploits 12 year old child laborers” or “THAT company that fired a single mom who now can’t support her own son” because that destroys brand loyalty and reputation and ultimately decreases sales and revenue. Instead, companies must find a balance, whether it be cutting work hours to make a detrimental part of the workforce temporarily no longer a key figure to moving production back on-shore or even tightening individual corporation labor laws and conducting inspections more often to demonstrate that a positive effort is in fact being made. In business, image is everything, and today more than ever ethics are playing a key role in determining business practices.
* Shirk, Evelyn. “New Dimensions in Ethics: Ethics and the Environment.” Ethics and the Environment. Proc. of Conf. on Ethics and the Environment, April 1985, Long Island University. Ed. Richard E. Hart. Lanham: University Press of America, 1992. 1-10.
The business plan will also be useful in facilitating the adoption of a strategy that will help the business prosper in the modern market. The plan will be a critical tool that will help in the production of a reliable strategy for attaining the goals and objectives. The proposed business plan will be implemented in three years time. Within the first three years, the business i...