Have you ever reflected over what is value? I don’t mean now principles or standards of behaviour, one’s or a society’s judgement of what is important in life. This we also call values. I want to adress value in the meaning of importance, worth, usefulness of something. And specifically relate to what I wrote about in my last past post: I want to do the RIGHT things right, so I can create VALUE for my customer.
You might find this easy because a product or service has a price, so can monetarize value. True, but is this the full truth? What about a modern internet TV with a certain price and the value for me considering to use it in my cabin in the woods where I have no electricity nor internet availability? Is the market price telling me anything about the value for me? So most likely we shall relate value to the person or organization that shall receive the value. Agreed?
To complicate things further let me tell you about my daughter’s dilemma right now. Her goal is to become a professional fotboll player and 17 years old she has come quite a bit on that way already. But now the next step needs to be taken: to get further individual development she needs to join another team and she is in the process of testing with and evaluating a few others. If she had reached her goal already she would get offers and she would most likely look on the monetary side of them. But since she is not there yet she really looks on the non-monetary value for her right now. And how does she define this? Well, this is her dilemma because the value has so many dimensions. I just list a subset of them now:
1. close enough to home, so school and daily logistics work
2. right level of the main team to get full development potential and exposure
3. right level of the second team or youth team if not developing quick enough or on the way back from a sickness or injury
4. the team mates, football is a team effort, so the team needs to have the right capacity, but also the right attitude, team-spirit, connect with each other
5. the trainer team that is responsible for tactics on the pitch, selecting the squad, but also developing the individual. And so on…..
Actually the monetary side is neglected totally, because in the current situation the individual development potential and probability is key. If the right club is chosen the fee they charge and the support they give or not doesn’t matter at all. In a few years if she doesn’t break trough to professionalism but continues with football for fun this aspect might be very important, but right now it is neglected. Value currently is not defined by monetary things, it is purely defined by the factors that determine her development potential and probability.
So leading back from that football example to business life we learn that personalization of the value to the receiver might be a quite complex exercise. Especially during a time of change when the environment and factors that define value are also changing. Very often the client does not even know what he/she/they see as value of the task/project to be done or not. Sometimes the client just accepts it needs to be done, sometimes not even that and according to the client there is no reason and value in it. During change we all go through different phases and especially in the early phases when we are in shock and denial we don’t reason that well for the future yet and then we might not understand the real value. So one of my tasks is to accompany the client and follow my client’s journey on realizing the value.
The first step in value creation is logically to understand, discuss and guide the client in the key question: What is value for YOU? Help the client if I realize the client is defining the value totally wrong, but at the same time also accepting that the client might stay with a totally different definition of value. Why do I focus on value creation? Let me ask you what happens, if I can neither contribute to create value according to the client’s definition nor to my view on how the value should be defined? To illustrate it more let me take an example: The client is a bakery and I help with a marketing campaign. The value definition according to the client is immediate daily sales, whereas I think the focus should be to attract more and more recurring customers. My marketing campaign attempts fail clearly on achieving the daily sales targets of the client and actually it doesn’t look like the attracted customers return either. I can continue to work with new campaign attempts, but wouldn’t that lead to frustration? If we were aligned on the target we would also be frustrated. So only way to create a good long-term relationship with my client is to focus on value. If the client’s definition is achieved, the client will see the value in it. In this example if I am right with my value definition and the number of recurring customers grows, I will prove this to my client by reaching the client’s main value, the daily sales, through the increased recurring customer base. If I am right I actually have created that much value that we in future either can stop my marketing campaigns or that we even highly over-achieve the daily sales targets if we continue. This is what I call success, when my efforts lead to positive new challenges for the client and in my opinion I think this is only achievable by focus on delivering value. Unless you count on luck….