Economies are suffering from the excessive focus of business managers on ‘financial profits’ and ‘return for investors’, and not enough on the needs of society. We need to understand the term profit in broader perspective. Profits are the means to an end and should not be treated as an end itself.
As Handy observed:
We need to eat to live; food is necessary condition of life. But if we lived mainly to eat, making food a sufficient or sole purpose of life, we would become gross. The purpose of business, in other words, is not to make a profit, full stop. It is to make a profit so that the business can do something more or better. That ‘something’ becomes the real justification for the business. Owners know this. Investor’s need not care.
If we talk about India, it is at the cross roads of ideologies in politics and economics. It is where capitalism and socialism, and even communism, co-exist and are evolving. In the past 15 years, the Indian economy has seen the benefits of open markets and entrepreneurship. But the benefits of growth have not spread far enough and fast enough. In developing democracies like India, business must follow the principle, ‘business for the people, by the people, and of the people.’
‘Business for the people’ include innovations in product and services so that more people can afford them, ‘Business by the people’ includes innovations in business models that engage more people in the process of production and distribution and ‘Business of the people’ include Innovations in enterprise models whereby more people participate as business owners within an extended enterprise.
Today democracy puts demands on business corporations. People want to participate more rapidly in the benefits of economic progress. In this scenario we need to know the fundamental of business-corporate philosophy of trusteeship, Innovations in inclusive business models, managing cash, controlling consistency, respect for people, and skills for building partnerships.
To many this will sound like quibbling with words. Not so. It is a moral issue.
