Ducker Essay

I agree with Peter Drucker (1973), the primary purpose of a business is to create and keep customers” (pg. 97). Many executives believe that profit is the primary purpose of a business and is a critical metric used within businesses towards achieving their objectives and producing the assets to finance development. However, Drucker notates profit is not the primary purpose of a business. Watson (2002), describes Drucker’s concept of understanding what a business is through its business purpose which is creating a customer in which the customer is the foundation of the business (pg. 55). Therefore, creating a customer base, retaining those customers, and gaining new customers enables an organization to maximize its profit for shareholders wealth through return on investments made by customers. Simply put, without customers, there is no business.

46). This is done by what is called a “transformation process” where employees within the organization, provide form, substances to the thoughts, ideas, and ambitions of the organization. Though the innovation process within the business, the flow of business is created in which goods and services are provided to customers to purchase, with monies. With the monies used by customers to purchase services and goods, are exchanged to pay employees’ salaries and vendors along with creating a return on investments (ROI). The ROI made by the customers assist the business in gauging its profit and ensuring long-term viability. The success or failure of a business ultimately depends on the organization’s reputation, brand, strategy, and the relationship established with their employees, customers, suppliers and