Profit vs. Product: What Truly Defines a Company's Success?

I posted a poll on LinkedIn asking a fundamental question about a company’s ultimate success. The poll had two options: Product and Profit. Responses varied, with some choosing profit over product and others selecting product over profit. This divergence of opinions inspired a deeper discussion about the topic today.

Before diving into the core question, let's start with the basic and essential concept of human cooperation.

The Essence of Human Cooperation

What is human cooperation, and why do we need to cooperate? The simple answer is that "We are social animals" or as Aristotle put it, "Humans are political animals" But what does it mean to be a political or social animal?

Humans engage in socialization and can form teams or groups to perform tasks based on mutual understanding, which supports our survival. We have families, tribes, religions, nations, and organizations or companies as forms of socialization.

By such cooperation, what do we achieve? At its core, the answer is survival.

Cooperation and Survival

How does cooperation support our survival? Cooperation involves working together to do and achieve something, like food. In ancient times, hunting for food required cooperation (consider the food or hunting tools as products). Over time, we modernized our techniques and developed thousands of new ways and products to fulfil our basic needs like food through innovation.

Another crucial aspect of cooperation is security. In ancient times, we needed protection from wild animals, natural disasters, and scarcity. We built weapons to hunt threatening animals, which are products. We constructed walls and roofs to secure our daily lives. Early on, dogs assisted humans much like ChatGPT does today, leading to the domestication of animals. If you look around in early livings, you will see thousands of products created through human cooperation.

This historical perspective highlights the immense value products have brought through ages of cooperation.

The Unique Human Advantage

However, the qualities of human beings like socialization, problem solving, intelligence are not unique to us. Bees can socialize, form groups, find food using different techniques, and cooperate effectively. Chimpanzees can think logically, solve problems, form groups, and cooperate efficiently. Many intelligent and social animals exist around us or have gone extinct, and they don't do much differently than us in these basic aspects.

So, what makes humans special? According to historian and writer Yuval Noah Harari in his book "Sapiens," animals cannot socialize or cooperate on a large scale. They socialize in very basic forms. Harari argues that humans' imaginary intelligence enables us to socialize and cooperate on a mass level. Humans invented ideas or visions, socialized these ideas, and cooperated around them. This imaginary socialization around a vision has significantly boosted human civilization, leading to giant cooperative structures like religions, tribes, nations, states, the United Nations, WHO, and companies.

Abstraction and Modern Cooperation

If you are a programmer, think of it like the concept of abstraction. We have abstracted the idea of cooperation and implemented it through various forms of socializing. We have discovered new ways to work in large cooperative structures such as states, nations, organizations, and companies. Since today's modern economy revolves around capitalism, which is centered around companies, these companies hold significant importance in our contemporary world. As always, humans are continually innovating and modernizing.

It's essential to remember that the basic idea of human cooperation remains the same even in this modern world: food and security. We need homes and food, cars to travel for food or office to buy the food after getting paid, and mobile phones to communicate. We have invented and innovated thousands of tools and techniques (products) to work within this giant structure of cooperation.

The Role of Profit

Where does the idea of profit fit into all this? In my opinion, profit is like the "sugar" intake behind the concept of products. Profit can be achieved via products, much like sugar is derived from food. Just as sugar can be considered the product’s actual benefit, a knife helps you cut food, or a car eases your travel—this is profit! As a producer of the product, you should receive the fair value of that product. This is like sugar for you as a producer too. For instance, when you sell a car to someone, the person gets the car, and you get the money. You can consider money as a product as well because it gives you the power to buy another asset.

However, if you overconsume profit—whether by selling or buying excessively—it will surely make you sick and addicted! Overconsumption of profit works the same way as excessive sugar in the body. While it might trigger your pleasure hormones, it will harm the fundamentals of society, just as an excessive amount of sugar disrupts the body's insulin regulation.

Therefore, products have their place in history as well in the present and future!

Profit is just like sugar intake—don't take it too much or too seriously to preserve the fundamentals of products as well as society!

That’s all! I hope this article helped you understand the topic better. If you have any questions or perspectives, please share them in the comments!