As with law and medicine, management is a practice, not a
religion. Every situation is a unique
opportunity. Therefore, all relevant
theories, methods and techniques must be considered to effectively plan,
execute and control the making of effective decisions and the creation of
desired value.
All managers please take note, the "benefit of value" and the "burden
of cost" does not represent opposites in the functional spectrum of business; they are
simply factors in an equation of short-term profit. Real profits are the premiums paid by patrons
for the performance of perceived promises.
Therefore, profits are a function of value alone, not cost. Cost is the organizations speculative
investment in its understanding of the consumers needs and its commitment to delivering the value it promised.
If it is true that great organizations under promise and
over deliver. Then it is equally true
that great managers never manage profits by manipulating costs.
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