Browsing by Author "Virak Prum, PhD"

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    DON’T AIM FOR PROFIT. INSTEAD, CREATE CUSTOMERS!
    (CamEd Business School, 2024-06-30) Virak Prum, PhD
    Purpose of any business: It is well known that the purpose of a business is to create customers. Nothing else should matter as much. Peter Drucker, the well-regarded creator of management study as a distinct discipline, announced his wisdom early on when he published his The Practice of Management in 1954. There is, he wrote then, “only one valid definition of business purpose: to create a customer.” (p.37) Yet, it is not uncommon to find managers and economists so focused on profit maximization which leads them to prioritize on quick wins, neglecting the need for a more comprehensive strategy. True, business environment in the 1950s might have been quite different to what we are facing presently. Globalization and technological advancements have brought about new challenges and changing realities into the market, a phenomenon which could make long-term strategies less certain. But, even so, half a century after his famous book first appeared, in the revised edition of Management published in 2008, the assertion remained unchanged: “to maximize profits…is not only false, it is irrelevant.” (p.97)