The REAL 4Ps - Rick Sapio (CEO of Mutual Capital Alliance, Inc.)

The last time Rick Sapio was on the show, he shared with us his personal philosophy and The Doorman Principle that accompanies it. This time, Rick shifts focus from the people around us to they way we approach our business. He calls it “The New Profit Paradigm” and it’s a formula through which we can evaluate business decisions and change the way we look at real Profit and alignment in our businesses. Rick believes that when you look at successful entrepreneurs, you’ll notice that they have a knack for balance. The entrepreneurs who focus completely on revenue or completely on expenses tend to flame out, says Rick, the ones who are able to approach things with a balanced focus are the truly successful business leaders. He says that Profit is more than just numbers, he looks at it as being made of the 4 Ps: Profit, People, Purpose and Planet. Profit is about the numbers themselves. People is about having the right people in the right roles, this includes everyone from employees, to vendors, and clients. Purpose is about the purpose of your company; not just defining the purpose of your company, but making sure its purpose is clear to all those involved. Planet is about being aware of the community around you and trying to give back to that community in some way, whether it be through charity or volunteer work or consciousness of impact.  If you make each of these four aspects a priority, says Rick, you’ll have a balanced approach and your business will be better for it. The equation on Rick’s napkin, is a kind of lens through which to assess decisions that have a potential effect on Profit. Put any business decision or problem into the formula and see what you come up with. Is this decision going to increase recurring revenue (as represented by the R)? Is it going to lower expenses or make expenses more variable (as represented by the EV)? Does it take the 4 P approach to Profit into account? If it doesn’t do any of these things, is it really the right move for you and your company? Rick uses this formula in combination with his personal set of core values and through the combination of the two, he’s able to make sure that his decisions are both aligned with who he is and balanced in focus. It’s a lens he uses to gauge his decisions, why not try it for yourself and see how the prescription changes your view? It changed mine. Listen to the conversation with Rick here: