Step 2: The Role of Purpose in Organizations and in Business Models

Moving from the brilliant statements of Peter Drucker, who asserted that the purpose of a company should be “to create a customer” and that the maximization of profit “does harm” to the business, this chapter discusses the purpose of a business in general before delving into the purpose within the RDHY model. Given Zhang Ruimin’s admiration for Peter Drucker’s work, it is not surprising that the purpose of the RDHY model aligns closely with Drucker’s ideas. The chapter then proceeds to analyze how companies that are willing to implement this business model articulate its purpose within their unique business and geographical contexts. By examining various implementations, the chapter provides insights into the adaptability and effectiveness of the RDHY model across different settings, illustrating its potential to drive innovation and sustainable growth globally. Through detailed examples and practical applications, readers will understand how the principles of the RDHY model can be tailored to diverse business environments, irrespective of companies’ size, industry, and location.