The Core of Profitability

Peter Drucker, world-famous strategist and consultant, shared an insight that has remained top of mind years after reading it…

“Because the purpose of business is to create a customer, the business enterprise has two—and only two—basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.”

​Drucker encapsulated the transformative power of marketing and innovation in just three sentences. Unfortunately, other business functions get the most attention…

Finance, sales, production, management, legal, and people.

But none of these directly create a new customer.

None directly produce profits.

None are are visible to and choose-able by the customer.

This is why having a differentiating idea at the core of your organization is so important.

It gives power to your marketing.

It creates opportunity for innovation.

It demands coherence in your thinking.

There’s no surviving without those necessary business functions, but it’s madness to place marketing and innovation on the back burner. These are the lifeblood of your organization.

So begin exploring what strategic power drives your marketing and innovation. Brainstorm on this statement...

We’re the only (category) who (differentiation).

Can you answer this easily?

Can you answer it powerfully?