Business: Big Ideas

Profit is not the purpose of a business — it is the evidence that the business is creating genuine value.

A business that pursues profit as the primary goal tends to cut costs in ways that erode value, eventually destroying the surplus it was trying to protect. Value creation is the mechanism; profit is the result.

When a measure becomes a target, it ceases to be a good measure — and this applies to every metric used to run a business.

Goodhart's Law is not a management curiosity. It explains short-termism, the failure of single-metric evaluation, and the systematic divergence between reported performance and underlying business health.