“Charles Koch is right, there is a difference between Good Profit and bad profit. And this book helps show you the way to good profit – whether you work for an international supermarket chain, a medium-sized regional business, or your own start-up.”
– John Mackey, Co-Founder and Co-CEO Whole Foods Market
“Charles Koch’s Good Profit is a must read for any businessperson or serious student of business… The book, like Koch’s management tools, bridges theory and practice masterfully. But the title’s engine says it best: ‘Good profit’ arises from delivering value to customers. And Koch Industries’ spectacular success over the past half century shows that good profit creates great value.”
– Glenn Hubbard, Dean and Russell L. Carson Professor of Finance and Economics, Columbia Business School
THE REVOLUTIONARY MANAGEMENT SYSTEM BEHIND ONE OF THE MOST SUCCESSFUL COMPANIES OF OUR TIME
In 1961, Charles Koch joined his father’s Wichita-based company, then valued at $21 million. Six years later, he was named chairman of the board and CEO of Koch Industries, Inc. Today, Koch Industries’ estimated worth is $100 billion — making it one of the largest private companies in the world. Koch exceeds the S&P 500’s five-decade growth by 27-fold and plans to double its value on average every six years.
What exactly does this company do and why is it so remarkably profitable? Koch’s name may not be on your stain-resistant carpet, stretch denim jeans, the connectors in your smart phone, or your baby’s ultra-absorbent diapers but it makes them all. And Koch’s Market-Based Management® system is what drives these innovations and many more.
Based on five decades of interdisciplinary studies, experimental discovery, and practical implementation across Koch businesses worldwide, the core objective of MBM is to generate good profit. Good profit results from products and services that customers vote for freely with their dollars, products that improve people’s lives. It results from a culture where employees are empowered to act entrepreneurially to discover customers’ preferences and the best ways to satisfy them. Good profit is what follows when long-term value is created for customers, employees, shareholders, and society.
Here, drawing on revealing, honest, and previously untold stories from his nearly six decades in business, Koch walks the reader through the five dimensions of MBM to show how to apply its framework to generate more good profit in any business, industry, or organization of any size. Readers will learn how to:
· Craft a vision for how to thrive in spite of increasingly rapid disruption
· Select and retain a workforce possessing both virtue and talent
· Create an environment of knowledge sharing that prizes respectful challenges from everyone at every level
· Award employees with ownership and decision rights based on their proven contributions, not job title
· Motivate all employees to maximize their contributions by structuring incentives so compensation is limited only by the value they create
A must-read for any leader, entrepreneur, or student, as well as anyone who wants a more civil, fair, and prosperous society, Good Profit is destined to rank as one of the greatest management books of all time.
In a rare television appearance, Charles Koch discusses the world of business and political funding with CBS Sunday Morning’s Anthony Mason:
ABOUT THE AUTHOR
Charles G. Koch is chairman of the board and CEO of Koch Industries, Inc., a position he has held since 1967. He is renowned for growing Koch Industries from just $21 million in the early 1960s to its current estimated value of $100 billion.
Mr. Koch has supported academic and public policy research (including many Nobel Prize winners) for more than 50 years, and helped build a number of organizations focused on research, policy, and education to advance the understanding of the free society, including the Cato Institute, the Institute for Humane Studies, and the Mercatus Center. He supports numerous nonprofits through the Charles Koch Foundation and the Charles Koch Institute, including an organization called Youth Entrepreneurs, which teaches at-risk high school students the values and skills they need to succeed in life.
The Charles Koch Foundation supports more than 400 research and education programs at about 250 colleges and universities.
Mr. Koch holds a bachelor’s degree in general engineering as well as two master’s degrees in nuclear and chemical engineering from MIT. He and his wife Liz have been married 43 years. They have two children and two grandchildren.
Koch Industries of Wichita, Kansas, began as Wood River Oil and Refining Co. in 1940. With a presence in more than 60 countries, Koch companies employ more than 100,000 people worldwide, with about 60,000 of those in the United States. From January 2009 to present, Koch companies have earned more than 1,000 awards for safety, environmental excellence, community stewardship, innovation, and customer service.