In the last of this five-part series on preparing a business for growth, I look at how leveraging expertise to solve customers` business needs enables them to articulate the company`s unique business value and ensures ongoing commitment to its offering, because it is either helping to reduce costs or improve growth.
Companies are becoming more aware of their ability to play a role in areas traditionally run by their customers. A clever supplier should say to a customer: "I can do this for you." The customer will say: "Yes, this is not part of my core business so I would rather you did it."
It`s about knowing the customer, knowing the company`s strengths and matching the two, so that the customer can be engaged in the process.
Ian Widdop, director
In leveraging a company`s expertise to build a solution for its clients` requirements, the main objective is to explore the organisation`s capabilities, as well as those of its partners, and to understand the uniqueness of the client. It can then proceed to the next step, which is identifying the actions that need to be taken to enable it to leverage combined capabilities and, ultimately, to provide the client with unique business value, thus making the company an indispensable partner.
It`s about knowing the customer, knowing the company`s strengths and matching the two, so that the customer can be engaged in the process.
In assessing opportunities and potential solutions, follow three basic steps:
1) Assess whether or not there is a solution-selling opportunity, how it can impact the customer, what it will take to win the customer, and if it is worth pursuing the opportunity.
2) Qualify the conceptual offering against criteria set for alignment with the customer`s business drivers, business impact on the customer and the customer`s customers, and the differentiation competitive advantage the solution can provide for the customer.
3) Articulate the unique business value the company will have for the customer.
These steps will help formulate the solution, determine the activities required, and the activities that need to be put in place to ensure competitiveness.
To see these activities through, begin by assessing available expertise and identifying existing capabilities in products/services, people and processes. In working with people across the company and those of the client, it is important to gain buy-in so that they can be encouraged to explore potential offerings and engage in inter-divisional cooperation. This will also enable joint expectations to be determined.
In designing the actual solutions to a customer`s requirements, apply tools and innovation techniques so as to have significant impact on the customer`s business, be aligned with the customer`s business drivers, and provide unique business value for the customer. Also, develop a plan for gaining the necessary resources to build the solution.
Constructing a value proposition
Step one: Examine the business issue or problem (the cause)
Identify clear and indisputable market trends or business drivers that currently have (or have the potential) to affect the customer`s way of doing business. The better the company can prioritise the trends or business drivers according to the significance of their impact, the more attention the offering will command.
Step two: Implications and impact (the effect)
Articulate the resulting impact of the trend or business driver.
Step three: Action or business initiative
Create an action or potential initiative for the customer. A single business driver or industry trend may spawn different potential initiatives for different functions or business units within the customer`s organisation. The value proposition should contain a total business solution involving multiple areas and facets of the customer`s environment. Interventions must take full advantage of combined expertise, thereby decreasing the likelihood of duplication by a competitor.
Step four: Potential results
Calculate the potential results. This will increase credibility as the company relates real results achieved from a similar process being applied to other clients. Be prepared to ask the client the right questions. It is important to solicit and secure customer involvement right from the start.
Step five: Required investment
List total pricing, and itemise different components if necessary.
Step six:
Period or timeframe
Take care in representing timescales. Accelerating time to value may give an advantage over a competitor who may not be able or willing to move at the same pace.
Step seven: Uniqueness of the offer
What is the customer being asked to buy? Make an effort to differentiate the company from its competitors.
Step eight: Impact of the status quo
Ensure that time from step six can be translated into either consequence costs or opportunity costs.
Step nine: The value of the solution
Identify and weigh all the variables that will dictate the project`s success. It is possible here to raise a barrier of entry to would-be competitors. Illustrate that profit will be taken from the customer`s resulting incremental profit - contingency-based billing like this is always well received.
It is worthwhile remembering that innovation and creativity remain key here. If people are stuck in traditional modes of thinking about what their company does and how, they will find it difficult to create new solutions that growth imperatives are demanding.
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