How do we make money?

A simple question.“We sell things.”“We make things and sell them”.“We publish books.”If you work in a retail or manufacturing environment,those answers should be pretty obvious.What if you provide a service?“We help people solve problems.”“We fix things that break.”“We show movies.”Surface answers all.Printing books,selling something,fixing someone ’s equipment allows an organization to present an invoice but does not ensure that anyone makes any money.

Most people have never been taught how business works,a fact that has fueled the Open-Book Management philosophy.In an article in the June 1995 issue of Inc.,John Case describes the three elements that make Open-Book Management different.

1.  Every employee sees —and learns to understand —the company ’s financials,along with all the other numbers that are critical to tracking the business ’s performance.
2. Employees learn that,whatever else they do,part of their job is to move those numbers in the right direction.
3. Employees have a direct stake in the company ’s success.
   

Employees in an Open-Book Management organization know how their organization makes money.But,I can hear you saying, “We ’re not an Open-Book company and I don ’t have the authority to make us one.True.But you can do your homework by asking this question of the members of your team,evaluating the responses,and establishing a plan to help your team see the big picture when it comes to the bottom line.

This could be scary if it occurs to you that you don ’t actually know the answer to this question yourself.Don ’t use that as an excuse to not ask the question.Use it as a reason to ask it of someone who knows and learn from them.