Throughout our careers, we hear buzz words without much thought regarding the real essence behind the words. Some of them, unlike many others, might even be intuitive, like Best of Breed, Best practices, Client-centric, Core competency, Customer-centric, Value Add, and many others. Let us select one word – Value Add, and dissect it so that we understand its true meaning and intent.
First of all, some house cleaning: Let us all agree that the most important thing to keep a business relevant is our customers. It does not matter what big ideas we have, how many assets we have around the world, number of patents, or the number of resources. What matters most is our customer because they bring in the money to pay our salaries, keep us solvent, and help us pursue our dreams and ambitions. I would go as far as saying that keeping our customer happy should be our number one focus.
So, how do we keep customers happy? Here is my list. It is not necessarily the only available list, but I’d venture to guess almost all lists have most of these items on it.
If you were to execute some combination of four items, then you are adding value; but what does that mean to a customer? Practitioners need to convert words into numbers, and then into dollars. Express value-add in terms of dollars, and the relationship with the customer is transformed. Look at value-add from the CFOs point of view.
Most of us stop short of translating our value-add story into dollars. Let’s take a modernization example. Instead of articulating reduction in MIPS, use of expensive mainframe programmers, or even the term “modernization” as value-add, what if our proposals talk about the fact that a $200 thousand investment will yield an ROI of $600 thousand! Go a step further, and talk about what would happen if the customer did not make this investment of $200 thousand. Develop the math behind the words. Remember, companies invest, and if you want to keep them happy, show them the money!