What is VALUE? VALUE: 1) a fair return or equivalent in goods, services, or money for something exchanged. 2) the monetary worth of something: market price. 3) relative worth, utility, or importance <a good value at the price> <the value of base stealing in baseball> <had nothing of value to say>. Merriam-Webster “Value means that someone is willing to pay more for something or is willing to make a change if he can’t get it with the current relationship” The Profit Zone byAdrian Slywotzky “Value is what people perceive it to be, and nothing more” The E-Myth Revisited byMichael E. Gerber
What is VALUE? Value is governed by two forces Desire: Essential to Unwanted Distinction: Unique to Generic Value is delivered in the form of products, services or information to solve customer’s problems We must look at value from the customer’s perspective
Who is my Customer? External Customer Internal Customer Intermediate Customer Ultimate Customer
Exercise Break into groups and discuss the following questions. What does VALUE mean to your Customers? How can we quantify the VALUE?
What is VALUE to my Customers? “It solves my problem at a reasonable price” Solve relevant problems “It’s easy!” Make it easier for them to do business with me
How do we get to specifics? Spend time with the customer. Just listening is not enough. We must observe what they are doing and how they are doing it. In mfg, this means spending time with operators – the people doing the actual work. No Longer Enough…
“People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!” -Theodore Levitt
Scoring Opportunities, i.e. Problems Identify Jobs, Outcomes & Constraints Problems that have been identified from customer inputs Score problems (opportunities) based on Importance & Satisfaction Outcome-Driven Innovation Process Source: What Customer’s Want by Tony Ulwick
Identifying Opportunities Source: What Customer’s Want by Tony Ulwick
Scoring Opportunities, i.e. Solutions Products & Service Opportunities Score based on Fit, Feasibility & Attractiveness FIT is scored based on alignment with the organization & the capabilities and capacity Feasibility is scored based on the ability to identify and manage technical and commercial risk Attractiveness scored based on overall financial expectations of the opportunity
Discover VALUE, the process
A Map of VALUE From “A New Definition of Value and a Revolution in Price Theory” www.endleofon.com
Recommended Reading What Customers Want, Using Outcome-Driven Innovation to Create Breakthrough Products and Services Anthony W. Ulwick Fast Innovation, Achieving superior differentiation, speed to market, and increased profitability Michael L. George Sales and Marketing The Six Sigma Way Michael J. Webb Delivering Profitable Value, A revolutionary framework to accelerate growth, generate wealth, and rediscover the heart of business Michael J. Lanning The E-Myth Revisited, Why Most Small Businesses Don't Work and What to Do About It Michael E. Gerber Blue Ocean Strategy, How to Create Uncontested Market Space and Make the Competition Irrelevant W. Chan Kim & Renée Maubourgne
About KTS Marketing Solutions Managing Partner, Tim DeRosett has 20 years experience in marketing, business development, and sales within industrial automation and high-technology companies. With experience in LEAN and Six Sigma methodologies, we bring process improvement to marketing, sales and service. We help high-tech business-to-business companies realize growth and increase share-holder value.
Thank You Tim DeRosett Managing Partner KTS Marketing Solutions, LLC 8216 Princeton-Glendale Road, #160 West Chester, OH 45069 513.407.4908, office firstname.lastname@example.org www.ktsmarketing.com Connect with us on LinkedIn www.LinkedIn.com/TimDeRosett Also join the Discover, Develop Deliver Value LinkedIn Group. Robotics Industries Association Member www.roboticsonline.com