Wednesday, February 6, 2013

Profits before Products? Think again!


John Sculley, an Apple executive for several years, had come over from Pepsi, where he was a marketing and sales executive for the company. Because of his position he was mainly focused on profit maximization rather than on product design.  , which caused sales for Apple to slowly decline.  But why did this happen?

Many times companies focus more on profits than they do on the actual product. They focus on how to sell the product, where to sell it, who to sell it to and most importantly, how are they going to make a profit? Yes, this is actually something all companies need to think of, but sometimes focusing on the product itself first will make a difference. Steve Jobs said: “My passion has been to build an enduring company where people were motivated to make great products. Everything else was secondary.

Sure, it was great to make a profit, because that was what allowed you to make great products. But the products, not the profits, were the motivation”. In Sculley’s case, instead of focusing on creating better products and innovating, his main priority was to make money. 

What can other business owners learn from this?  Remember the saying, “Money isn’t everything.”  If that’s your only motivation, you may do well for a while, but it catches up with you.   Quality first … profit second.  That’s the way to grow a business!

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