19. Nobody makes money!

"Are you making a lot of money?"
"It's tough to make money in business these days."
"A business is a money-making machine."

We often hear these statements, yet they are completely false. Totally untrue. Utterly misleading.

Nobody makes money. The only people who "make" or print money is the federal government, through the Bank of Canada.

For the rest of us, the only thing we do is pass around money (paper or electronic). The money usually goes to where there is a lot of value (defined as the ratio of "perceived utility" to "sacrificed cash"). If "sacrificed cash" equals zero, then value is infinite. Hence, the enormous success of Netscape, Yahoo!, Skype, etc.

(The above paragraph contains a powerful business secret, and if you got it, I predict you will soon open a Swiss bank account).

Money is sex, value is love.

Asking a business person how much money he's making, is like asking a husband: "Are you having a lot of sex with your wife?"

Not only is it none of anybody's business, it also shows a complete misunderstanding of the purpose of a business.

A business, like a marriage, exists to build something for the long-term. Something we often call a legacy.

And anything built for the long-term should be planned, tested, verified, audited, and continually improved.

But these critical activities can only be performed IF the business system is clearly documented.

In conclusion, although nobody can "make" money, we can create value for customers. The greater the quantity and quality of value we produce, the more money will flow to us. To improve the quality and quantity of value produced, we need a system. To improve that system continually, we must document it thoroughly.