Stage-1: The Productive Mode

Injunction: Make Profits!

Market-centred principles are the foundation of any business, so no special activation is required. At Stage-1, the focus is on company operations and how they can be run efficiently and economically while ensuring sufficient products are purchased by customers at a price that generates a profit.

ClosedReview the Background

   

Foundation: the Proprietor Mindset

A solid foundation depends on such things as:

  • Staff’s ability to identify customers and sell to them.
  • Systems to handle customers before, during, after transactions.
  • Competent operations via systems & strong management.
  • Everybody working hard and to the best of their ability.
  • Reliable trading relationships with suppliers, distributors, advisors.
  • Finances: cash control, costs contained, capital reserves.
  • Forward planning and development capability.

All subsequent approaches reflect distinctive and sometimes complex ways to sustain the business and potentially increase profitability, but … any choices made at later Stages (higher Levels) must be able to be delivered cost-effectively by the operations, which always remain the foundation.

ClosedQ: Is being productive product-centric? or market-centric? or both? 

Developmental Stimulus?

Most small businesses are proprietorial, as might be expected. Amazing as it may seem, some rather large corporation-sized firms manage to survive purely as production or service outfits, with minimal attention given to market interaction, branding and other similar tools of success.

More on small businesses: Closed Family-run businesses and small outfits serving a local community are usually proprietorial. The business is run primarily as a lifestyle activity or a quasi-hobby for the owner(s) rather than as a money-making enterprise. Such businesses lack any market strategy and cannot withstand a determined competitor. Often the business survives because it is only marginally profitable or the market is small and difficult, so not worth invading. See: the producer mentality.

A genuine business that is profitable in a free market, soon invites predatory competitors. Suddenly customers can start going somewhere else. A good business must rapidly develop a strong response in such an environment. To stay profitable, a move to Stage-2 power principles is essential: the new ethical rule is: Fight!

Originally posted: July 2009