Determining Your One Thing For Growth, Part 3
By Doug Davidoff
In the last two issues of The INTELLIGENT GROWTH Ezine, I discussed the critical importance of determining the “one thing” your company does better than anyone else in the world. I also wrote about how that “one thing” must become the focus of your go-to-market strategy. Your “one thing” is more commonly known as your “value proposition,” or the promise you make to your customers. The most successful growth companies in the world (Fedex, Southwest, Dell, Microsoft, GE, etc.) understand the importance of a clearly articulated promise and the importance of delivering on that promise every second of every day.
In this issue, I discuss a concept I call “Value Propositions Foundations™.” Once you’ve determined your one thing, you must select the foundation on which to build it. As you’ll see, there are a number of strategic approaches you can use to deliver on your promise. However, you’ll find each of them falls into one of four Value Propositions Foundations. The key to success is choosing which one of these four foundations supports your value proposition best and focusing on it completely.
Remember, your value proposition should be the articulation of two key points: what you do for your clients and why what you do is important. Once you have organizational consensus on those key points, the next step is deciding what the foundation of your value proposition will be. As I mentioned, there are four choices. You must decide on only one. Trying to build a business on more than one foundation is one of the leading Stuckpoints™. Stuckpoints are a situation where a misalignment of resources disrupts effective execution and causes, results in business stagnation and, at worst, business failure. More about these in upcoming issues.
THE FOUR VALUE PROPOSITION FOUNDATIONS
Operational Excellence – This value proposition focuses on being the best at producing products and services at the lowest cost possible. The focus of this value proposition is taking out costs wherever you can, ensuring predictability and stability in the implementation or manufacturing process, passing on savings to your clients and adding some of those savings to your profit margins. Operational Excellence is typically the value proposition of great commodity organizations.
Customer Intimacy – This value proposition focuses on being the best at collaborating with your customers and having a close relationship with them. You want to get to know your clients as well as or better then they know themselves. Your solutions are always customized to their individual needs. Your customers, in essence, become collaborators with you in the development of your products and services.
Best In Class – This value proposition focuses on building the best, however you define it. The best does not mean the tightest fit. The company with this value proposition focuses almost fanatically on staying ahead of the competition. Your mission is to provide an offering that can’t be found anywhere else and is superior to everything else. When a new product/service comes to market, a Best-In-Class company is already at work making it obsolete.
Enrichment – This is the underlying value proposition of organizations that focus on being the best at making the world (or the individual) better. Companies such as Imagine operate in the realm of enrichment. This value proposition does not mean that there is not a profit motive, but profit is pursued through the aim of enabling people or organizations to become their best or fulfill their desires.
Focus on organizing and creating predictability, reliability, low cost and structure.
Focus on the customer, resulting in customization and tailoring to customer needs.
Best in Class
Focus on creating superiority of product or service, uniqueness, one of a kind value-added service and product.
Focus on fulfilling human potential, helping to create a better life for the customer and offering self-actualization.
DISCIPLINE – THE KEY TO SUCCESS
Remember, you must choose one, and only one, value proposition foundation for your organization. Once you make that decision, everything you do should nurture and reinforce that value proposition. And I do mean everything! Your marketing must support it. Your hiring practices must support it. Your sales systems, operations and anything else you can think of must be coordinated to make you the absolute best you can possibly be in that area. The “absolute best” is necessarily limited by the resources you have available such as time, people and capital. But put the resources you do have available behind your one thing and be the best you are able to be at that particular moment.
You have to understand that every successful offering obviously has some elements from each of the Value Proposition Foundations. Even if you have chosen “Enrichment” as your value proposition, you must have some organizational structure, your offerings must be pertinent to your customers and the quality of what you do must meet a certain standard. But none of those things is your “one thing.” Enrichment is. The key is to develop enough competency to manage those other elements outside your chosen value proposition foundation so that they don’t prevent you from delivering on your promise consistently.
A FINAL NOTE
It is acceptable, and in some cases preferred, to choose both a primary and a secondary value proposition. However, as you work to clarify your value proposition, be careful about adding a secondary focus. Given the nature of organizations, there seems to be an impulse to “hedge your bets,” “be all things to all people,” or “not to forget about the previous commitment to X.” But remember that accommodations such as these can confuse your team and your customers and reduce the benefits that come from focusing rigorously on a single promise. If you do choose a secondary value proposition, don’t ever let it get in the way of the effort to find your “one thing.”
NEXT MONTH: The process I use when working with clients to help develop and articulate their “one thing.”
Adapted from Edgar Papke’s presentation, “Leading High Performance Teams.”
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