Should Profit Be the Only Purpose of a Business?: An Essay

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SHOULD PROFIT BE THE ONLY PURPOSE OF THE
BUSINESS?
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
Table of Contents
Introduction................................................................................................................................2
Other objectives of business.......................................................................................................2
Critical analysis of the objectives of organization.....................................................................4
Conclusion..................................................................................................................................6
References..................................................................................................................................8
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
Introduction
Business is a deeply human institution, however, its objective is not only to make as much
capital as possible. The agenda is something else. It is required to put purpose back into
capitalism. The reason behind this is that business is primarily about the purpose and creating
value for stakeholders. Business and ethics go hand in hand. Sometime people become selfish
and sometime other-regarding interests. Money should be bi-product in any business. The
main motive of the business should be making the lives of people easier. An economy thrives
when business is diversified and successful. However, a business is seemed successful when
it earns a profit. However, profit cannot be the sole objective that a business tries to achieve.
There are many other objectives that emerge with business. These objectives can involve
responses to changes in environment, growth or responsibilities of societies.
Other objectives of business
It has been observed that when a business expands in size, its objectives keep on changing
from just earning profit to increasing its size of the market and making greater sales of its unit
produced by the business. Similarly, when a business is new and the competition is in the
present market, then the object of the business shift from money making to surviving and
making its presence felt. It has to sell at break-even prices. As opined by Mkpojiogu and
Hashim (2016), on the other hand, if the business faces a decline in the profits it may try to
minimize its costs or accelerates its revenue to regain the level of profit. It is the
responsibility of the business to decide how the demands of the customers can be met. For
this purpose, they are required to adopt a strategy such as product differentiation where the
business competes by providing a consumer rare and unique products. Apart from profit,
there are many objectives that are fulfilled by a business such as corporate social
responsibility. It has been observed that a business must meet social responsibilities. It is
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
expected by society to serve them goods and services of the prices or quality they demand. It
has also been expected by consumers that business should consider human rights and the
impact on the environment by the goods that have been committed by the business. It has
been observed that business cannot stay profit-centric as there are many other responsibilities
that need to be taken care of by the business. As opined by Mkpojiogu and Hashim (2016),
the organization should follow certain policies that will safeguard the properties of nature.
Another important function of the business is to meet the expectations of the stakeholders.
Meeting the expectation of the stakeholders is important or else the business cannot function
properly. The stakeholders include customers, suppliers, employees, and government. A
business is also required to meet the objectives of the stakeholders so that the profit margin of
the business can be maintained. Without meeting the expectations of the stakeholders the
business will not be able to make a profit. Thus it can be said that without meeting the
expectations of the suppliers the organization will not be able to meet the objectives of the
business. Product differentiation is another factor that needs to be considered by the business
that will help the organization to earn a profit. As opined by Ali and Raza (2017), profit
cannot be the sole objective of business this can be better explained with the help of an
example. Last year when the women of Saudi Arabia got permission to drive coco cola
launched a commercial that commemorates the victory of women. The advertisement
beautifully celebrated the freedom of women in Saudi Arabia. The company launched the
advertisement mainly for Saudi Arabia where a father is handing over the car keys to the
daughter to drive the car. Here the advertisement was not profit-oriented but was a social
message oriented. Here the giant company launched the commercial only to celebrate the
position and respect that was earned by women in Saudi Arabia. As opined by So et al.
(2016), this commercial might have helped the company to draw more new customers but the
message it tried to convey to the citizens were beautifully conveyed to the rest of the world. It
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
was regarded as a good gesture of the company towards the country. Their many such
examples where it has been clearly portrayed by the companies that business is not always
profit-centric there can be other objectives than money making. However, often people view
business as the only money making institution but there are many other objectives of the
business that are followed by the organization. As opined by Ali and Raza (2017), employee
retention and attraction is another objective of the business that has a direct impact on the
profit and market share of the company. It is known that employee turnover costs money in
low productivity and the cost associated with recruiting. This includes advertising
employment and paying placement agencies. It is the duty of the business to provide job
satisfaction to the employees so that the employees contribute towards the goal of the
organization. This is squarely related to the profit and productivity of the company.
Critical analysis of the objectives of organization
Sustainable growth of the organization is another purpose that is served by the business.
When the competition is high the purpose if the business shifts from profit to sustain the
rising competition. It becomes extremely important for the business than to take approaches
that will help the business to thrive and survive. As opined by Vitell (2015), the purpose of
the business shifts from one aspect to another aspect. Without sustainable growth, the
business will not be able to earn a profit. It is also important for the organization to reach out
to the right customers. This can also be the purpose of the business. Customer satisfaction is
another objective of the business that needs to be fulfilled by the organization. Without out
reaching out to the right customer, the business will never be able to expand its business and
thus the profit margin of the organization will not be increased. It is important for every
business whatever the sector is to concentrate on customer satisfaction. As opined by Spence
(2016), customer satisfaction and customer expectation play a major role in earning profit to
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
the organization. Marketing is more than getting customers and creating a process that
effectively deals with creating a marketplace. The objective of the changed management is to
build a dynamic organization that is ready to meet the challenges that are faced by the
industry.
Staying ahead of the competition and sustainable growth of the business are interrelated. A
comprehensive analysis of the activities of the competition should be an objective of the on-
going business. As opined by Mkpojiogu and Hashim (2016), in order to stay ahead of the
competition, the business is required to understand their products very closely as this will
help the business to flourish the business in the global platform. However, all the objectives
that have been discussed in this study directly influence the profit of the organization.it is
important for the business to understand the mission and vision of the company.
Another purpose of the business can be delivering excellent customer service so that it can
retain the customers. It is important for the business to retain its customers by providing
supreme customer service. The revenue of the business is escalated by providing supreme
customer service. Increasing the productivity of the company is another purpose of the
business that needs to be looked after. As opined by Kaura, Durga Prasad and Sharma (2015),
this will help the business to keep the quality of the products in check. It has also been
observed that here the author has concentrated on the other objectives that are served by the
business. The study here has explored other objectives that can be undertaken by the
organization. However, some of the scholars have argued the fact that all strategies that are
adopted by the organization are profit oriented and hence profit becomes the only purpose of
the business. As opined by Moos and Botha (2016), in addition to that, they have claimed that
promotional activities that are undertaken by the business directly benefit the profit of the
organization. Whatever is done to increase the profit of the organization. The authors have
argued the fact that without these strategies the business will not be able to earn a profit. The
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
study here has thrown light into the fact that without profit goals in mind the business would
not have been able to increase its productivity and customer satisfaction. They have further
argued that all these variables are interrelated and have the potential to influence the ease of
doing business. The business will not be able to grow or expand without these objectives.
They have claimed the fact that all these objectives are sub set objectives of profit. Here it has
been closely examined that without the effective objective of the organization it will not be
possible for the company to earn a profit. On the other hand, it has been explained in the
study that the objective of the business can be shifted with the nee of the situation. It is often
said that profit cannot become the only purpose of any business. As opined by Due and Lund
(2018), the reason behind this is that there are certain social responsibilities that need to be
fulfilled by the business. While doing business in any country or while penetrating into the
market of foreign country culture is the biggest factor that cannot be ignored by the business.
There are some social responsibilities that need to be fulfilled by the organization.
Overlooking these factors can be detrimental to the survival of the organization. Here the
author has mentioned all other objectives that should be the purpose of the organization.
Conclusion
Here the study has discussed whether profit is the only purpose of the business. The study has
explored many more purposes of the business that should be fulfilled by the organization. It
has been observed the fact that corporate responsibility, customer service, customer
satisfaction, employee satisfaction are other purposes of the organization that needs to take
care of the business. A critical analysis of the research topic has been done which clearly
defines the fact that all these objectives are sub set of profit and can be driven together to earn
profit for the company. It has also been observed in this study that without providing good
service to the customers the company will not be able to retain old customers nor will not be
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
able to attract new customers which will not be beneficial for the profit of the company.
Some of the scholars have argued that profit should be the sole purpose of business based on
which the management of the company takes effective strategies that help the business to
increase the revenue of the company. The study here has clearly investigated the variable that
can influence the business and which should be given preferences in order to increase the
profit of the organization. The study here has reflected on the fact that all these objectives
helps business to earn more profit. Thus, it can be said that profit cannot be the only purpose
of the company. The reason behind this is that the purpose of the business keeps on changing
with the changing situation. So the profit should not be the only purpose of the business.
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
References
Due, H.K. and Lund, C., 2018. Investing with dual objectives: the investment decision of
impact investors and their preferences for the business model of social ventures: a qualitative
exploration (Master's thesis).
Moos, M. and Botha, M., 2016. How do age and location affect a business? Evaluating the
objectives, outputs and outcomes of small business policy. South African Journal of
Economic and Management Sciences, 19(3), pp.344-357.
Kaura, V., Durga Prasad, C.S. and Sharma, S., 2015. Service quality, service convenience,
price and fairness, customer loyalty, and the mediating role of customer
satisfaction. International Journal of Bank Marketing, 33(4), pp.404-422.
Mkpojiogu, E.O. and Hashim, N.L., 2016. Understanding the relationship between Kano
model’s customer satisfaction scores and self-stated requirements
importance. SpringerPlus, 5(1), p.197.
Spence, L.J., 2016. Small business social responsibility: Expanding core CSR
theory. Business & Society, 55(1), pp.23-55.
Vitell, S.J., 2015. A case for consumer social responsibility (CnSR): Including a selected
review of consumer ethics/social responsibility research. Journal of Business Ethics, 130(4),
pp.767-774.
So, K.K.F., King, C., Sparks, B.A. and Wang, Y., 2016. Enhancing customer relationships
with retail service brands: The role of customer engagement. Journal of Service
Management, 27(2), pp.170-193.
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SHOULD PROFIT BE THE ONLY PURPOSE OF THE BUSINESS?
Ali, M. and Raza, S.A., 2017. Service quality perception and customer satisfaction in Islamic
banks of Pakistan: the modified SERVQUAL model. Total Quality Management & Business
Excellence, 28(5-6), pp.559-577.
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