Business 101

    As you know, I have the good fortune to have found my dream job at the end of my working career. I am a professor in the School of Business and Nonprofit Management at North Park University. I am having the time of my life doing what I love and believe I was truly meant to be doing.
     In my classes, I want my students to have a sense of what business is all about. I want them to understand the functions and processes that comprise a business and how they all fit together. So, I have come up with a short definition that I use in my Operations Management course. I call it Business 101 though it is not really a course.
     It is my definition and clearly from my point of view. I started in quality management and over the span of my career it gradually gravitated into supply chain management. I have only worked at companies that made products. I worked in the auto and consumer packaged goods industries. I have only worked for Fortune 500 companies. I have never worked in finance or investment banking nor have I ever really had any desire to work in those fields even though I must admit the kind of money some make is indeed a lure. All of this, biases whatever insights I think I might have. But it doesn’t stop me from trying to have, codify, and present insights and observations. It is what I do by nature, was trained to do in a way as a mathematician, and certainly paid to do as a quality and reliability engineer.
     Not every student will run a large business or have the entrepreneurial wherewithal to start one. But, almost every student upon graduation will work in a business and ought to know where and how their job and functional areas fits into the larger scheme of things.
     Here is my Business 101 definition.

• Defining business success is pretty simple. Business is about making a profit. It is cut and dry. 
• How is that done? Well for me, it is first and foremost providing products and services that customers want. 
• It is then selling these same products at a high enough volume to more than cover ones fixed costs and at a price higher than the cost of goods and production, and, voila, the business is profitable and can thrive and grow. 
• Don’t do this and the opposite happens, the business loses money and will eventually have to cease operations, call it quits. 
• This is not a one-time deal. A business to do this continually. 
• To make it even more challenging, the competition of the business would love to steal their market share and acts aggressively to that end. 
• On top of this, markets and the customer preferences are continually changing. 
• So, a business needs to be aware of all this and adapt and innovate their product and service offerings to remain competitive and relevant to their customers and ahead of their competition. 

     As a result, some businesses expand and grow while others shrink and even go out of business.
     It may well be a big “duh.” But I wonder. Seeing the way so many companies flounder, I am not sure this is so front of mind of everyone. Even if it is making it all work is not so easy. Look at the Detroit Auto companies, Chipotle, Boeing, and Sears just to name a few.

     Oh yes, W. Edwards Deming probably had some influence on my definition...

W. Edwards Deming 1950