What to be for whom?
It is an easy thing to try to be all things to all people, but you risk ending up undifferentiated. Instead, it is much better to develop a compelling answer to the most fundamental question for any business: 'Why should our chosen customers do business with us?’ So, what to be for whom?
Value does not lie inside your products, services, quality, it lies inside the mind of the customer.
Customer Value Strategy
When is a customer value strategy important?
- big market(s) with limited commercial resources
- new business / commercial strategy to implement
- integration after merger/acquisition
- dynamic market circumstances
- dynamic competition
- price competition / decreasing margins
Business case for customer value management?
- 43% higher margin
- 39% higher turnover
- 38% higher customer loyalty
- 61% higher dealsize
To develop a successful value creation strategy you have to identify what points of value your (potential) customers seek, and which you are able to deliver. Basically three main types of value can be created by organizations:
- Functional value: this value is associated with the product/service attributes and its performance.
- Business value: the extent to which an offering impacts the customer business operations and profit & loss
- Organizational value: the extent to which customers attach or associate strategic meaning to the company offering
Value Principles Framework
Depending along what type of value you choose to lead, you will then need to orient the entire way you do business so that you can deliver the benefits of that value proposition. In creating business or organizational value, it is therefore important to determine the threshold of the three value dimensions along which your company will establish its competitive edge: operational competence, product differentiation and customer responsiveness.
We perfectly understand that the selection of your company’s set of value principles is no small or easy matter. The R2R Value Principles Framework will provide you a guiding hand in defining the value principles relevant to your chosen competitive edge and develop a practical vision that aligns all stakeholders and sets the direction for Agile implementation.
Turning strategy into action
The path towards transforming your commercial performance is challenging and calls for an business driven approach which, at the same time, drives both business results and organizational change. For this we developed a practical Agile Implementation method which proved to be vital to the success of many of our assignments.