Value Creation: Good Profit
Recently, My friend and I started a book club. We meet on Clubhouse at 6 every Sunday. Just message me, if you’re interested. The first book we are reading is called “Good Profit” by Charles Koch. He is the owner of Koch Industries, and he’s basically the Warren Buffet of privately owned companies.
The theme of his book is good profit. Surprising, I know. Koch defines good profit as business that creates value for others. Businesses accomplish this through mutually beneficial trades, principled entrepreneurship, and market-based management. He is adamantly against subsidized companies, or “too big to fail”.
I’ve enjoyed this book, because he gets to the main points of what makes his business successful. There are no secrets to success. There is no new formula. His company creates value through understanding the market they are in. That means understanding the customer’s needs and wants. That also means having specific jobs his products accomplish.
Koch also focuses on creative disruption. More specifically, overcoming and embracing creative disruption. In the book he frequently describes leading a company as having the ground constantly crumbling beneath your feet. This book is great for anybody looking to get a reality check in regards to their startup. It’s not just about revenues, profits, and immediate success. You will need to diversify your attention, lead with empathy, and understand that every season has its storms.