1. Creates and delivers something of value
2. That other people want or need
3. At a price they are willing to pay
4. In a way that satisfies the customer’s needs and expectations
5. So, that the business brings in enough Profit to make it worthwhile for the owners to continue operation.
It doesn’t matter if you are running a solo venture or a billion-dollar brand. Take any one of these five factors away and you don’t have a business – you have something else. A venture that doesn’t create value for others is a hobby. A venture that doesn’t attract Attention is a flop. A venture that doesn’t sell the value it creates is a nonprofit. A venture that doesn’t deliver what it promises is a scam. A venture that doesn’t bring in enough money to keep operating is not going to exist very long.
At the core, every business is a collection of five independent processes, each of which flows into the next.
1. Value Creation – discovering what people need or want, then creating it.
2. Marketing – attracting attention and building demand for what you have created.
3. Sales – turning prospective customers into paying customers.
4. Value Delivery – giving your customers what you have promised and ensuring that they are satisfied.
5. Finance – bringing in enough money to keep going and make your effort worthwhile.
If these five things sound simple, its because they are. Business is not a rocket science - it’s a process of identifying a problem and finding a way to solve it has that benefits both parties.
Reference link: www.personalmba.com
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