Levitt pointed out that a corporation must be viewed as a customer -creating and customer-satisfying organism. Management must focus first on securing and evolving with customers, and second on producing goods or services.
What can be done to help companies avoid this dead end? But salespeople were used to calling on engineering and maintenance departments. Calling on production operations presented significant challenges for Mega International sales people:.
All these barriers made for a potentially long, complex selling effort that could well have been a waste of time. Salespeople knew the district sales managers would have little patience for it.
Most salespeople figured they were better off sticking with what they already knew. They showed the new widgets to the same engineering and maintenance contacts who bought the old ones. And so it went.
Product divisions worked their hearts out creating new and innovative products, many of which were dashed upon the shoals by a sales force unable to leverage their potential. Few people within Mega International could see the lack of alignment among key functional groups—including, most tragically, the lack of alignment between the sales force and their customers. Those that did were not powerful enough to do anything about it. Projected revenues for new products did not materialize.
Ultimately, waves of layoffs ensued. This kind of situation is far too common, especially where technology continues to make new products and services possible. Whose job is it to prevent these situations? Who is accountable for redefining what is valuable to customers, designing effective new ways of helping them buy, and getting these new processes implemented in the field? In short, whose job is it to make sales easier? In most companies, neither the marketing nor the sales department has the skills, the motivation, or the accountability to do it.
The fact is that in many companies no one is accountable for this crucial task! Is it any wonder that Mr. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience. Necessary Necessary. Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website.
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It is mandatory to procure user consent prior to running these cookies on your website. Is your business getting the full benefit of the value you create for your customers and other stakeholders? Do you understand the tangible and intangible value exchanges that take place with you customers, partners and stakeholders? Mastering how value is created in a business is essential to the long-term success of any company. A business model expresses how a company creates, delivers and captures value.
Being able to recognise where value is being captured and where it is not, therefore, plays an important part in business model innovation. The Cambridge Value Mapping Tool has been developed and refined over the last five years.
Once the team makes some basic assumptions about lab operations, it is straightforward to derive the savings in operating costs from having to perform fewer test redos. But in this situation, discussion and investigation may reveal further differentiators that turn into value drivers.
For example, ease of use may mean that more lab personnel can use the system when they need it, resulting in a reduction in testing delays.
Faster time to results is often valuable, with its dollarized benefits readily quantifiable in many lab settings. With some good messaging there is then a Value Proposition that is effective in a head-to-head comparison with Dominant System X, but is also be a starting point for comparisons with other alternatives where there are other differentiators.
Dollarizing the benefits of accuracy will help to defend a larger price premium for Recent Entrant versus Low End System Y. Having a Value Map is a great first step towards a strong Value Proposition. It jump starts good value modeling and provides perspective on differentiation versus the various competitors that commercial teams usually face in the marketplace.
Why Value Maps? In summary, implementing a product management discipline requiring Value Maps helps to drive a common customer-centric framework for product strategy that can be applied in many useful ways. Value Maps help to understand and monitor positioning, evaluate potential price changes and consider marketing and innovation strategy on a customer-centric basis. We can go deeper than Value Maps in understanding customer value, but they are a great place to start.
Where Are We Headed? In this blog we consider a case study, looking at a single, representative market as we explore six ways to apply Value Maps: Understand Product Positioning Monitor Market Changes. Low End System Y that provides the lowest cost solution, but is less accurate and more difficult to use Recent Entrant with comparable testing accuracy to Dominant System X but with a simpler user interface and streamlined workflow in comparison to the market leader Premium System Z, a system with greater accuracy than any of the first three systems but one that requires more time and greater lab expertise to deliver this higher level of testing accuracy.
Component Based System W, an assortment of configurations of high end equipment and software, assembled on a bespoke basis to meet high scientific standards.
Premium System Z was originally designed as an integrated system to take market share from bespoke configurations that we are classifying as Component Based System W. Application 1: Understand Product Positioning Perspective: Recent Entrant Whether or not we operate in a market with frequent innovation, Value Maps provide a useful snapshot of product positioning with underlying qualitative support for visual comparisons.
Application 2: Monitor Market Changes Perspective: Dominant System X Once Value Maps have been created, requiring an additional process of updating Value Maps annually is usually low cost and low effort, providing a product management discipline with impact. Application 4: Design High Impact Marketing Campaigns Perspective: Recent Entrant Seeing a shifting competitive landscape in a Value Map raises questions that help us better understand our customers and how they use our product.
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