“If you are not making the progress you would like to and are capable of making, it is simply because your goals are not clearly defined.”
– Paul J Meyer
Chances are you’ve never heard of the late Paul J. Meyer. But if you do some research you will learn about someone who achieved outstanding success as a business owner, athlete, devoted husband and father (married for 38 years), humanitarian and philanthropist.
Meyer is also the highest-selling business and personal development author of all time with over $2.5 billion (yes, it is billion) in sales of his books and programs.
As Meyer suggests, if you want to get better results you’ve got to have clearly defined goals. But successful strategic planning is much more than having clear goals.
A key step in the strategic planning process
A key step in any strategic planning endeavour is making sure that your goals are both clearly defined, and that they are the right goals. Fact is, having the wrong goal is just as bad as having no goal at all.
So what are your main business goals?
Is your goal to have more flexibility and time-freedom? Is it to build up a business asset you can one day sell or pass onto family members? Do you have a personal or business mission you want to fulfill?
As you know, there are a number of goals you can set for yourself and your business.
However, there is one overriding goal that is more important than all the others. What is it?
World-renowned management consultant, the late Peter Drucker, alluded to the core goal of a business when he declared that:
“There is only one valid definition of business purpose: to create a customer.”
This quote comes from Drucker’s 1955 book, The Practice of Management, so it’s more than 50 years old. But the essence of what he wrote is still valid today, just as it will be 100 years from now.
As Drucker highlights, the purpose – or goal – of a business is to create a customer.
However, there is a key piece missing from Drucker’s definition. And it’s all based on the fact that not all customers are created equal. Let me explain it this way.
In most businesses, a small percentage of customers account for most of the revenue and profits. Further, a good percentage of customers in most businesses are unprofitable.
So if your focus in business is on getting any sort of customer, you could find yourself with a mountain of unprofitable customers. And a loss-making business.
To have a successful business you need to do more than create a customer. You need to create a profitable customer. That’s why, in my view:
The most important goal of a business is to create profitable customers
Creating profitable customers must be your core business goal, and your main reason for being in business.
There’s little point in being your own boss if you have very few profitable customers.
And, you can’t build a business asset without profitable customers.
So whether you want flexibility, to grow an asset, or to fulfill a mission you need profitable customers to get there. So again, the most important goal of a business is to create profitable customers.
Which begs the question. What is a profitable customer? I’ll answer this question in the next issue.