AIM Archives - Tag: leadership goals

“Maximize shareholder value” is the pledge of allegiance recited in board rooms. It is a poor goal.

401-Business-Pledge

This mantra guides the decisions of the business masses. But is it right? Peter Drucker didn’t think so. He said the primary purpose of a business is to acquire and keep customers. I believe increased shareholder value is a good result, but a lousy goal. You’ll have better results if your goal becomes: “Understand and meet the needs of our customers.”

More in 2-minute video at 5. Shareholder wealth is a poor goal

“Maximize shareholder value” is the pledge of allegiance recited in board rooms. It is a poor goal.

9-Business-Pledge

This mantra guides the decisions of the business masses. But is it right? Peter Drucker didn’t think so. He said the primary purpose of a business is to acquire and keep customers. I believe increased shareholder value is a good result, but a lousy goal. You’ll have better results if your goal becomes: “Understand and meet the needs of our customers.”

More in article, Why Maximizing Shareholder Value is a Flawed Goal