Value answers the fundamental question every customer asks when they buy a product: "what do I get for my money?" It is the sum total of the benefits received for the money spent and it can actually be positive or negative. If what I'm buying is intrinsically or extrinsically MORE worth more than what I pay for it, it's positive and I've gained value for the money I spent. On the other hand, if it's worth less - bummer - I just lost value and paid more that what I should have. As an equation: Value = Price - Cost.
Over the years, I've come to the realization that understanding value and how it is created and destroyed is the very essence of a business. It's so important yet so apparently missed by so many that I thought it would be a good opportunity to create a business that helps companies find and deliver it! VALUE:driven delivers superior value to our customers by helping them to discover and deliver superior value to their customers.
So back to my working definition of value, here it is: Value is the full set of experiences, including price, that an organization delivers to it's intended customers within a specific timeframe. It is at the root of all wealth creation and, therefore, it's force behind the growth and demise of all business and industry. There are some new terms to define in this definition, which I'll get into in my next blog post. But catch Miki's latest post because he speaks to the notion of "intended customer".
Think about your business: How does this definition help you view your business in a new and better way? What are the experiences that you are delivering and, most importantly, are they delivering a net positive, neutral or negative value to your customers? How do you know this for sure and how do you improve it?
These are all the topics of my future blog posts, so stay tuned!