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The Profit Orientation

and
The Service Concept

The Profit

Definitions of profit
Business
the excess of total revenues over total costs
during a specific period of time
Economist
the excess over the return to
capital(interest), to land(rent) and to
labor(wage)

Concepts of Profit

Profit as a cause
it serves as the motivating ultimate end or
objective of the businessman
it serves as a standard against which the
operational efforts or performance of the
businessman is measured
it is the further measure of how well the
businessman undertake the other can
objectives of his business

Concepts of Profit...contd
Profit as an effect
Profit is what the businessman derives from
the business and serves as his reward for
good performance

THE
CONCEP
T

The Service Concept


As a commodity (next ch.)
As an objective
Service is what business immediately
provides in its operations or what
constitutes its reason for existence

Service on The Industry


Level
As the venue for the production and
distribution of goods and services, business
on the industrial level provides the
functional arena in which the social process
of business is given expression

Service on The Corporate


Level
(a) Core (or essential) service which is
inherent in the source of the service and
(b) marginal service which is an add-on or
extended service and is promotional in
nature.

Service on The Corporate


Level... Contd

Core service. Service as an essential


business function consists in those services
which are essential to the business concept
itself, without which business on the
corporate level is impossible.

Service on The Corporate


Level... Contd
Company core service
Product core service
Personal core service