Edward Alessandro RE: Discussion 1 - Week 1 As anyone in a publicly trade company knows, the shareholders invest in an organization for 1 reason: to make money. Milton Friedman suggests that the sole purpose of business is to generate a profit (VanderPal, 2020). America is a capitalistic nation where the American Dream is built around making a living. Nothing is free and while the key to happiness is not money, In the song Tomorrow by Silverchair there is a line that goes "they say that money isn't everything, but I'd like to see you live without it" (Johns & Gillies, 1994). Some may argue that the primary purpose of a business is to create and keep customers or that the primary purpose of business is to solve people's problems. While each of these theories about a business are true, they are just steps a business must take in order to reach the true primary goal of a business: to make money. A good business model has a product or service that people need (solves their problems) and attracts the customers. If the product and service are good, customers will continue to purchase the product or service. All of this is so that the customer will spend their money at the business, in turn making a profit. According to Zenger (2013), "Companies that enjoy sustained success are typically founded on a coherent theory of value creation" (p. 4). Zenger (2013) then describes the history of Walt Disney Company provides a case in point (p. 4). Zenger (2013) describes how Walt Disney founded the company with a clear business strategy that obviously worked well, but when Walt Disney died, the company seemed to lose site of his vision and revenue declined (p. 5). The company was faced with the decision to break up the company and sell or establish new leadership. Disney decided to establish new leadership who brought back the original vision and brought Disney back as a huge revenue stream for shareholders. References: VanderPal, G. (2020). Discussion 1 - Week 1. Johns, D. & Gillies, B. (1994). Tomorrow [Recorded by Silverchair]. On Tomorrow Single [Medium of recording CD, 7"]. Location: Murmur Zenger, T. (2013). What is the theory of your firm? Harvard Business Review, 91(6), 72–78. Jalyssa Dixon RE: Discussion 1 - Week 1 This week I have been assigned Point of View A, which holds that the sole purpose of business is to generate profit for shareholders. One of the main reasons someone starts a business, is the intention to make a profit. There may be other factors that play into this, but profits reigns over others. As a shareholder you may want your organization to help implement and create social change on a large scale however, to do so there must be disposal funds. The shareholders consist normally of owners and investors. This means that they also have a voice when it comes to the decisions within the business. The managers want to take these into consideration to help maximize their shareholders profit. This also includes carrying out changes that may not set right with other employees. However, enacting their plan to get the best return is needed to maintain those same employees. Senior leaders must ensure that shareholders receive maximum returns so that they and the business can continue to thrive. Shareholders are looking to receive the maximum return so that they can take care of their family and life. As a manager you must ensure that you are making sound employee, structural and financial decisions. They must also guide their employees to do the same within their work. Most significant, we found that top management has a profound impact on how well employees grasp and support strategy…” (Galunic, C., & Hermreck, I. (2012)). It is their responsibility to create a culture of one that puts the shareholders needs in the forefront. This includes keeping tabs on competition and other practices throughout the sector. References Galunic, C., & Hermreck, I. (2012). How to help employees "get" strategy. Harvard Business Review, 90(12), 24.
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