With a New Year starting, it’s a great time to step back from your business and take a fresh look at something most business leaders take for granted or seldom work on – your “business model.”
What is your company’s business model – and how’s it working for you? I don’t mean its strategy – that’s different. The “business model” is the very core definition of your business – WHY it exists, to Serve WHOM – and what those NEEDS really are.
The traditional business model focuses on things like:
– Maximizing growth and return on financial investment – which is leftover from a time when it was financial capital that was the scarce resource and the driver of the wealth creation process. While that is an important measure of business performance (and certainly a motivator of those who provide the financial capital to a business – or own its stock), it’s not a great motivator of people in the business.
– Finding a market need – and serving it better than anyone else. Most business models assume that the key to success is to pick the right market and then provide value to it at a cost below the price charged to the market. That is just one way of defining a business model, not the only way. Even those who subscribe to this business model need to see beyond the traditional model, which focuses on the market for your product or service. That’s not the only way to think of the market as we’ll see below
– Filling material needs – traditionally, the economy has been about filling material needs, mostly with material products. Now there’s much more to a business model than that
What about a business model where…
- the primary resource we’re utilizing is not so much financial capital, but human capital – and even more specifically human spirit? Can we build a successful business model around that and prosper?
- the primary focus is not so much on the customer, but rather on the supplier or employee? …and not just to raise their material standard of living but to raise their sense of self-realization and spiritual fulfillment? Can we build a successful business model around that and prosper?
I see more and more examples of an alternative business model built with that kind of mindset – or should I say “heartset”. This really turns the business model on its head.
Here’s an example: I received an email recently from Amber Chand, founder and head of a business with an alternative business model. She describes her (for-profit) business thus on its website:
“The Women’s Peace Collection is an enterprise that fully supports women in regions of conflict and post-conflict – as mothers, peace builders, entrepreneurs, and skilled artisans. We are a company that believes in the power of creative enterprise as a foundation for healthy and vibrant communities.”
So, her business serves its suppliers – and not just their material needs/desires, but a far larger vision. The market is mostly U.S. consumers reached through the Internet.
In a recent email to her customers, she shared this:
“As I think back on this year, I am reminded of those poignant moments which touched the hearts of so many – the weavers in Darfur who danced around their makeshift tent when they discovered that their Peace Baskets were appreciated by American audiences, chanting “We are artists not just refugees!”……”
In this one example are the seeds of a new “business model” – one that turns the traditional business world upside down. It might herald a major shift from a focus on the marketplace to a focus on the workplace. It also focuses not just on the material dimension of work and life, but on the non-material, or spiritual dimension.
The Bottom Line – What’s it Mean to You?
How might Amber’s example apply to you? Ask yourself these questions about your own business and leadership:
- What is the ultimate purpose of your business – to do what for whom? Try answering it in as deep or global a way as you can. Why? Such a new perspective on the purpose of your business might just rekindle enthusiasm and focus in your company, making people – including yourself, more alive and motivated.
- What is the non-material or spiritual dimension of this? I know – business is supposed to be rational and practical. But some of the most successful businesses, even big public ones, have at their core spiritual purpose and principles.
- In what ways is your business currently inspiring people in the business and connected to the business? If you’re not, how might you be? Many people no longer want to have dealings with companies that don’t have a sense of higher purpose and noble values.
- In what ways are you seeing and interacting with people not only in terms of their material needs and contributions, but also in terms of their highest aspirations and deepest contributions? Treating people this way can stimulate even greater contribution on that level.
2010 is a great opportunity to shift your thinking to this new Business Model. You will join a wonderful “crowd” of people who are already shaping and leading such businesses as you make this shift – and may well supercharge your business model in the process.