Principles Over Profits: How to Build a Business With Substance and Stability
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Principles Over Profits: How to Build a Business With Substance and Stability
Tim Reed
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Introduction: Rafts and Canoes
How does a company make decisions, inspire people, and stay grounded?
These are three fundamental things to consider if you want to build a company with substance and stability.
Unfortunately, many companies rarely (if ever) consider them, simply because they’re preoccupied with a different question: What will lead to the most—and the quickest—profit?
But this preoccupation comes at a cost.
Because, over time, companies that pursue profit above all else find that they must cut corners to maintain the status quo. What’s more, profit is a master that’s never satisfied. It doesn’t care about your customers, it doesn’t care about your team, it doesn’t care about your longevity—it just wants more.
Now, a business can run like this for a while—a long while. But if feeding the dragon is what’s most important (and everyone in a company knows when that’s the case), motivation naturally suffers as customers get exploited, employees grow apathetic, and managers clamor for safety.
As morale atrophies, the ability to make bold and difficult decisions wanes. Realizing that everything is expendable, people inside the business become more focused on building silos of shelter rather than taking actions of consequence to serve their customers and move the company forward.
Simply put, companies lose their bearings when they have nothing substantive to guide their decision-making and inspire their people.
Simply put, companies lose their bearings when they have nothing substantive to guide their decision-making and inspire their people.
The journey of business is always tumultuous, and companies run by profit are like a canoe. A canoe can be big, it can be small, it can have leaks, or it can hold water—but the people in the boat never have the stability to do anything but sit for fear of rocking it.
The alternative is to choose principles over profits.
Even though a company governed by principles will still face the same turbulent waters as one that’s governed by profits, it approaches them in a raft, not a canoe. A raft—whether big or small—has inherent stability. The people on it can stand up; they don’t have to sit hunkered down for fear of tipping the boat; they can change positions with relative ease; they can row in any direction if the need arises.
In short, businesses that choose principles over profits have substance and stability. Because profit can’t help make decisions of consequence—but principles can. Principles can also call people to a higher standard and inspire them to pursue it. And principles can keep companies grounded, realistic, and humble.
With all of that in mind, let’s take a deep dive into the three business benefits of choosing principles over profits.
Business Benefits of Principles
For starters, it’s important to admit that building a principle-based company won’t guarantee success in the marketplace. It may not provide you with a second home, another motorcycle, or a watch that makes others brim with jealousy (it certainly hasn’t for me).
But choosing principles over profits will put your team in the best position possible to make a difference with the work they’re doing. It will guide their decision-making with incredible wisdom. And it will unleash their creativity to solve problems that could never be conquered otherwise.
Choosing principles over profits will put your team in the best position possible to make a difference with the work they’re doing.
This article is brought to you by Associated Energy Systems.
To be governed by principles, they must first be established and then made public. You can call them core values, company beliefs, precepts, directives, or ideologies—the semantics aren’t important. What matters is that they are established, that they are clear, and that they come first—even when it’s inconvenient.
When a business consistently makes decisions based on publicly stated principles, people know what they’re getting and can choose whether they want to work there or not. This self-selection is powerful, and it immediately changes the dynamic of the organization. Building an organization on principles says, “We’re not for everyone, but we might be for you.” And those who choose to enroll are doing so because they want to be a part of it—not because they have to.
Furthermore, when people within an organization know that the company isn’t ruled by something as arbitrary and indifferent as profit, it transforms how they work. They think, they dream, and they even critique with the best interests of the company in mind. A business built on the foundation of principles will naturally create a culture of collaboration where team members help each other along the way toward the goal.
As the people within an organization see rigorous attention given to a set of principles, it becomes clear that the company is about more than any one person—and, in today’s world, people are dying for this.
You don’t have to go far to find a podcast, news article, or social media post extolling the idea that your immediate happiness is the highest good—and that anyone who would hinder the unadulterated expression of your “authentic self” is oppressive, close-minded, and must be silenced. But all you have to do is look at the rising rates of depression, addiction, and suicide to see just how unstable a person’s universe gets when they make themselves the center of it.
The result is that there are legions of people who are hungry for something bigger than themselves. People who ache to contribute and want genuine meaning to replace the hollow shell of selfishness they’ve been living into—these are the people your company will attract.
Of course, even though choosing principles over profits can inspire people like never before, that doesn’t mean it’s easy. On the contrary, it’s incredibly difficult—because profit is necessary for the organization to exist. Naturally, building your company on principles acknowledges that there are more important things than your business existing. Submitting to principles above all else declares there may be a day when your organization ceases to exist because you don’t have the profits necessary to continue and you won’t sacrifice your principles to get them.
Naturally, building your company on principles acknowledges that there are more important things than your business existing.
And that’s okay. In fact, it’s more than okay—it’s good. Because acknowledging that your company isn’t the center of the universe is sure to keep you and your team grounded, realistic, and humble—and our world needs people with these characteristics now more than ever.
Principles for Success
At this point, a new question arises: Are all principles equal?
I’d say, “No.”
From my vantage point, there are eight particular principles that a business—and business leader—would be wise to follow. They aren’t exhaustive, but the combination of them, I believe, harnesses a unique power that few companies have. These principles both inspire and remind. They cut and they soothe. They cultivate and they reprimand. And they are a guiding force for behavior, innovation, evaluation, and excellence if we submit to them.
Those principles are as follows:
- Default to generosity.
- Stay in touch with your customers’ experiences.
- Confront the brutal facts about your company.
- Seek innovation wherever you can find it.
- Be honest with your customers—especially when it’s difficult.
- Trust your team to make the call.
- View limitations as opportunities.
- Don’t take yourself too seriously.
These principles both inspire and remind. They cut and they soothe. They cultivate and they reprimand. And they are a guiding force for behavior, innovation, evaluation, and excellence if we submit to them.
The journey of a business is always bumpy, but we have the choice to build our company on a firm foundation of wisdom beyond ourselves—and use that to govern our actions—or the shifting sands of profits that are here today and gone tomorrow.
Conclusion: Trees by Streams
At the end of the day, a business is only as good as the decisions it makes and the people it inspires. And, like the wizard behind the curtain, a company ruled by profit is ever pulling strings to instill submission and fear—always shallow, always hollow. But the company that chooses principles over profits is like a tree planted by streams of water, yielding its fruit in season, providing shelter from the storm, and giving shade and supplement for all who come near.
This is a company of substance. This is a company with stability.
And this is a company we should strive to build—at all costs.
Tim Reed
Tim Reed is the President of WhyFire, where he helps business leaders in the hearth industry take control of their companies by providing them with sales tools to save time and make money. He's also the host of The Fire Time Podcast, which is actively helping thousands of people grow themselves—and their companies.
