The 4A’s that build Incredible Management and Successful Executives

Posted November 12, 2016 by Customer Value Foundation
Categories: Business & Management

In this article I will discuss the A’s that cause management to be incredible and executives to be successful. You too can be successful.

The 4 A’s of Incredible Management

In my book, Value Creation: The Definitive Guide for Business Leaders, I added a 4th A (Ability) to what Management gurus talk about in the 3 A’s to ready ourselves for the future:

Agility

Adaptiveness

Ambidextrousness

The 4th A: Ability, which is aided by training, education, knowledge management, hard work, management style, creativity and innovativeness. (That is why you need this in your company).

Think about the future, self-tuning companies and agility, adaptation and ambidextrousness run by able CEOs, moving from selling to Customers to becoming his buying aide.

Your company’s Customer Value Index can be improved through Value Creation and the use of the 4 A’s.

Many consultants will say ability is a given, but I think it is underplayed. The CXOs’ ability is crucial to the success of the company. Their ability to change, to work in a disruptive environment, their ability to think through the challenges and play the right cards, to strategize and motivate are crucial.

You all understand Adaptiveness and Agility. Ambidextrousness is the ability to handle two opposingly different strategies and tasks simultaneously.

You need to create these 4A’s in your company to be successful

The 4 A’s of SuccessfulExecutives:

Neil Pasricha, Director, The Institute for Global Happiness mentions:

Awareness

Attitude and

Authenticity

as being necessary traits for executives. In my estimate,you first have to build your self-esteem and believe in yourself. Without awareness, you will be lost. Attitude is most important. As W. Clement Stone said, there is little difference in people, but that little difference makes a bigdifference. That little difference is attitude. The big difference is whether it is positive or negative.

Authenticity is about being genuine, and true to yourself and with others, being dependable and honest.

I add a 4thA and that is ABILITY. I would add belonging and a sense of ownership. I also suggest an ABCD:

ABCD

Ability, Awareness, Authenticity, Attitude, the 4As of successful executives.

Belonging

Communication

DNA Do Not Annoy

You can all create value and install incredible management and become successful executives.

For questions, Contact Gautam Mahajan at Mahajan@CustomerValueFoundation.com

Would love your comments and help. We are happy to help others in education and executive education on courses in Value Creation.

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

Replace Purchasing Executives with Robots

Posted October 25, 2016 by Customer Value Foundation
Categories: Business & Management

If Price is everything, we can replace Purchasing people by robots or computers.

The title begs the question: Is price everything? We find many companies and their executives bemoaning the fact that price is everything. The Purchasing people are only looking at prices.

My first reaction is in that case purchasing people can be replaced by robots, if all they are interested in is price. On reflection, why not also replace the selling executives who think price is everything?

Imagine this kind of an environment. Prices will come down because both purchasing and selling executives when robotised will cost less.

That makes no sense to me. Value is side-lined. Robots will be saying I can sell anything at a price.

Companies will say I will buy anything at a lower price.

Are we moving to this nonsensical situation? People like me who were taught to sell on value and relationship will become extinct. Purchasing guys will only want a number and no dialog. There will be no value chain and the buying company will also forget to sell on value and only sell on price. Almost like the grim looking Soviet buildings going decrepit in all parts of the former Soviet Union: In Estonia, in Georgia, Romania and so on.

Should bean counter type purchasing people look at value? And should sellers have the courage to position themselves in the value chain and discuss the value which will prevent the buyer from becoming a commodity?

Should Purchasing people and sales people collaborate to become value developers rather than price cutters? Can they look at latent value and see if it can be converted to real value or should they look only at price?

Your call!

Mahajan@CustomerValueFoundation.com

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

Value is Waiting to Happen. What you can do about creating disruptive value for yourself?

Posted October 18, 2016 by Customer Value Foundation
Categories: Business & Management

This elusive word value, which we all seek but do not always find…Is it there, is it discovered, or is it created?

Is it a two edge sword, where on the one hand it is created and on the other side it is diluted?

Or is it a win-win situation? Value is created for both sides (or co-created?)

In my definition, there is latent or potential value. Value which exists but is not noticed.

I am going to give a few examples:

  1. Where value is shared with the customer and the provider gets little value

Google search, free: Creates great value for us customers, and very little for the company or disproportionately less (at least when it started, and for a number of years after that). Is it win-win? Is this because Google had a long term policy?

Giftivism and pay what you like: Restaurants (Karma Kitchen in Berkeley) or eye clinics (Arvind Eye Hospital) are an example) where you pay what you want, and your payment could fund or pay for others who come after you. The high throughput this causes, lowers cost per patient and payment to doctors per patient, increases value for customers, reduces costs of supplies like medicine, stent etc.

Nipun Mehta in a Ted talk said instead of showing Value we were creating Value. What can we give rather than what can we get. (https://www.youtube.com/watch?v=kpyc84kamhw)

  1. Where value is created for the customer and the provider and simultaneously destroying value for someone else

Uber: Cars are being used sparingly (they stand idle for most of the day). Uber increases utilisation, and so fewer cars will be needed, a lose situation for car makers, a win situation for consumers who get transportation on demand.

  1. Where value is not noticed

Look around you. Do you notice value that is staring us in the face and waiting to happen. Examples are

This example has happened. In India, the helpless service people like independent plumbers and electricians who could not own phones can now be in touch with their customers, do more with their lives and be reached by the customer (sharing their time effectively). This was waiting to happen, and did not happen by design but happened as these people acquired cell phones and became connected.

Audhesh Paswan, Associate Dean of Northern Texas University talked about the value creation of Bollywood culture. It exposes India and Indian culture to countries in Asia, Europe, the Middle East and the Americas. People are now learning Bollywood dance.

Had the Indian Foreign Service/Indian Government looked at this as a way of making India known and Indian culture popular, they would have promoted Bollywood into these countries and converted latent value into real value years ago, rather than latent value evolving as a matter of course.

A similar example is the Indian brain drain, which was bemoaned by everyone including the Government, because educated Indians were leaving India. Today, everyone says wow! How smart. We have Indians around the world contributing in so many different spheres, and becoming recognised. Most send money back to India. Others come back and contribute to India. Latent value was not developed and not harnessed. It just happened.

When driverless cars happen, where can you create value? In parking solutions, in making cars available where needed, in refuelling/re-energising options, in downsizing cars, in making single person modules or pods, by redesigning roads. The ideas are endless, the value can be huge. And what do you do with unemployed drivers?

And security systems, to add value for those seeking security or those seeking to penetrate security. From invisibility solutions to overwritten videos, from molecular keys for locks to… (let your imagination run. See what you’d like to see, and ask why it isn’t there)

And when this latent or potential value is noticed, we call it disruptive technology or innovation. Be aware of potential value (learn to become aware, because value exists but it has to be seen, it has to be noticed and appreciated, like beauty). Latent value has to be nurtured, and built into real value by you. It then has to be shared (or co-created with customers).

Disruption is the waking up of people, becoming aware of latent value.

And when this latent or potential value is noticed, we call it disruptive technology or innovation.

You can be a disruptor, too. Look for potential value. Value is everywhere around you. You have to notice it and build the latent value to real value. You can use any of the techniques above.

 Would love your comments and help. We are happy to help others in education and executive education on courses in Value Creation.

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

Creating Value for Yourself means Creating Value for Others

Posted September 30, 2016 by Customer Value Foundation
Categories: Business & Management

Creating Value for yourself means Creating Value for others

I gave a talk to BBA and MBA entering students at SGT University in Delhi and then to Model Institute in Jammu a few days ago. I asked the students whom they should create value for? For ourselves was the answer.

I told them to create value for themselves, they must create value for those around them, their fellow students, the teachers and the institute. Then and only then will these people say that the student is creating value, and also he or she will notice the value created for him/her.

This is true for a company. A company that sets out to create value for itself without creating value for its employees, partners, supply and delivery chain, society and the Customers will not create value for the company. All of these together will create value for the company. Creating value for yourself without creating value for others could lead to value depletion.

The company must understand this. Creating value for the company’s stakeholders is a sure way of creating value for the company.

Would love your comments and help. We are happy to help others in education and executive education on courses in Value Creation.

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

The 8 Principles of Customer Value Creation

Posted September 9, 2016 by Customer Value Foundation
Categories: Business & Management

Tags: , , ,

To appreciate Customer Value Creation, you must understand the principles of Customer Value Creation. The principles of Customer Value Creation, enunciated by Gautam Mahajan are:

The 1st Principle: Customers tend to buy or use those products or services that they perceive create greater value for them than competitive offers. It is essential for executives and leaders to create higher value for their Customers than competition can.

 The 2nd Principle: Customer Value Creation is applicable in all fields, such as business, service, education and academics, society and government, social work, innovation and entrepreneurship. It impacts humanity.

 The 3rd Principle: Customer Value Creation touches all stakeholders, you, your colleagues, your employees, your partners (supply chain, delivery chain, and unions), and society to create resounding value for the Customer and thereby for the shareholder. It is the source for creating Customers and retaining existing ones, increasing loyalty, market share and profits

The 4th Principle: Customer Value Creation is proactively exceeding what is basically expected of you or your job and is going beyond your functional and routine roles to creating value in your eco-system. Value creation can be planned or spontaneous, and in both functional and emotional thinking

 The 5th Principle: Customer Value Creation leverages a person’s or an organisation’s potential, learning and creativity while making it meaningful and worthwhile for people to belong and perform, both physically and emotionally

 The 6th Principle: Customer Value Creation presents a very powerful decision making tool for companies to decide on actions, programs, strategies for the Customer that can increase the company’s longevity and profitability.

 The 7th Principle: Value Creation must exceed Value destruction or reduce negative value and be done consciously (not just unconsciously)

 The 8th Principle: Values (what you stand for, integrity, honesty, fairness etc.) creates Customer Value (that is Customers Value your Values)

 These principles form the foundation of the Customer Value Creation strategy and implementation, resulting in great value for you and your company.

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

Don’t Waste Money Blindly Starting Loyalty, CJ, CX, CR, or CS Programs.

Posted August 28, 2016 by Customer Value Foundation
Categories: Business & Management

Every day I read that some company has started a new program for Customer Loyalty, or for Customer Journey or for Customer Experience or for Customer Response or for Customer Success. How can one program work for one company and not for another? Is there a diagnostic the company use that calls for these programs? Or are business results falling, causing an immediate knee jerk response to do ‘something’?

Do you need programs for Loyalty, CX, CS, CJ, and CR?

I do not know whether you do. Do you? Or is some consultant selling you on motherhood statements? Yes loyalty, CX, CJ, CS, CR are all important. They should be inherent in your company’s DNA. Why aren’t they?

Was there a problem?

I suspect there was one of two problems. One was that you felt you should improve some aspect of your Customer program such as experience. Someone says these are nice (or proper things) to do. Hence let’s start a program on (you name it).

The other is that some business result or performance was wanting. Market share, lower prices, retention etc. The boss asks his people to work on these. The solution is one of the types of programs described above.

What was the base problem?

The base problem could have been loss of market share, falling of Customer retention/loyalty, or price pressure or profit reduction, or that you are not creating enough value versus your competition.

What is the solution to the base problem?

First, all of us will agree that Customers have a choice between competing products or offers. Why do they buy from one or the other? What makes them buy?

The answer is the Customer will buy from that competitor he perceives he is getting better value from. This means he balances what it costs him and what benefits he perceives he will get from the competitors, or what the offer is worth to him.

  • What is his perception of cost?The amount of time and energy to buy, to understand, and use the product, and the price and payment terms
  • What is his perception of benefits? The benefits would depend on his perception of the product, the company’s people, the company’s image, the retailer, the service, the loyalty programs if any, etc.
  • If the Customer can perceive benefits and cost, can your company measure these? First the juxtaposition of benefits and cost is called Customer Value and can be measured. Certainly you want to know the value your Customer perceives you are creating. Is that enough? Not really. Because the Customer is looking at competitive offers. And so, too your Company has to look at competitors. What is the value your competitors are creating?
  • Can you compare your company to competitors by measuring Customer’s perceptions? We compare the perception of the value we create and divide this by the value your competitors create. We call this Customer Value Added

       Customer Value Added=       The Value we add to our Customers                                                 The Value your competitors add to their Customers

This Customer Value survey also throws up the relative importance of cost and benefits. How important are the costs, and how important are the benefits (if value is 100, is cost 30 and benefits 70? This depends on the product or service, and whether they are more of a commodity or a niche).

In addition, for each item of benefit or cost, we get a relative importance, and whether we are better or worse than competition.

What should we work on?

There are two criteria to select what we should work on. One is the relative importance of that attribute in benefit or cost (we get this from the survey); and whether we are better or worse than competition (from the survey). So, we should select those items important to the Customer in his purchase decision; and if we are worse, we have to improve on these. If we are better, we have to communicate these to the world.

We have to customise our improvement programs to the Customer’s needs. As we run those programs that increase the value to the Customer, we will find that the Customer gets a better experience, a better response from us, a comfortable and shorter journey, and better service. It has been proven that loyalty and market share will increase, and so will profitability (see data from PIMS (Profit Improvement through Marketing Strategies) based on1000 American companies in my book: Total Customer Value Management, Transforming Business Thinking.)

Unrelated or isolated programs do very little good:

Thus selecting a loyalty program when the Customer Value study shows it has very little influence on buying, then it is a waste of time instituting such a program. On the other hand, if the study shows it is important, and then we need to work on it. Or if the study shows the service is important and we are poor in service, we must start a program to improve service. Or if in cost, the relative importance of the time and energy required to buy is high, we must have a Customer Journey program to reduce the time and energy the Customer spends (only if the survey shows we are poor at it) or tell the world buying from us requires less time and energy (only if we are better). In short customise your program based on Customer feedback.

What programs to run?

Based on the Customer Value survey of your Customers and potential Customers, we will know what programs to run (or what aspects of programs to run). We may need to improve Customer experience only in service and not in buying; we may need to improve the Customer Journey program in buying if the Customer is unhappy with the time and energy it takes to buy. We may wish to improve a Customer response program if the Customer cannot get information or answers readily, and if this is important to the Customer; and so on.

One size fits all does not work. Customised programs based on Customer Value studies are the ones that will work.

Don’t waste your time by running programs because they sound good or others are doing them. Base them on the Customer Value you will create, and help the Customer buy from you because of superior value of your offer.

Would love your comments and help. We are happy to help others in education and executive education on courses in Value Creation.

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.

How to get a Service Culture Mind-set?

Posted August 20, 2016 by Customer Value Foundation
Categories: Business & Management

I recently gave a talk to ISSIP (pronounced IZip and stands for International Society of Service Innovation Professionals) on Service Value Creation. Jim Spohrer of IBM asked me how we get the service culture mind-set inculcated.

Here is the answer.

In my previous post on Service Culture versus Customer Culture, I wrote that often frontline service people were very good with Customers. The lack of Customer Culture at the top levels of the company prevented a great overall Customer experience.

Most companies focus on the processes and systems to help the service people become Customeric. Unfortunately the nuts and bolts of these actions do not impact the mind-set of the front line people.

To get a Customer culture, the service culture must also permeate to the top level people, into the C-suite.

How do we do this:

We have to work both with the top level people and the frontline people.

We form Customer Centric Circles, where frontline people along with staff people (from HRD, IT, Finance, logistics. etc.) let their hair down and just talk about their job, their Customers, the difficulty they have with Customers, the opportunities, and what they should do to make the Customer happy. The staff people are there to help them with systems and procedures to allow them to do the right things for the Customer. An example is if the frontline person notices there are many queries on an inaccuracy in the company’s website, they might suggest a change. The staff people and the frontline people discuss the best possible way to change this and then the IT department takes over to improve the website.

The results we see from Customer centric Circles, which we started in 2004 in various companies, include: Tata, Godrej and others.

  1. Increase the self-esteem

Most of these people, particularly in third world countries come from a different class or strata of society than those they serve. They need to feel adequate, and capable of serving in a mental fashion not just a menial fashion. They have to become proud of themselves, their achievements, and their ability to do a good job and provide happiness. Part of this comes from skills training, part from experience. But a big part is just discussing why Customers are so difficult. As they do this, they start to realise many of the causes for the irritation of the Customer are due to the fault of the company, or the frontline people. Examples are the part did not reach on time, or did not work; or the service person has not come on time, or someone had promised to call back and there was no call.

A discussion on why these problems happen, how they can be prevented in the future and action steps are taken.

The frontline people’s awareness of the Customer and his problems increases. The frontline people become more perceptive and having an awareness of resolving Customer issues causes them to become pro-active.

  1. Pro-activeness:

Once we build the employee’s self-esteem and his awareness, the frontline people become more proactive.

  1.      Enabling:

The role of the staff people is to enable the frontline people to become pro-active by giving them the help, the support and the tools to make them pro-active. These are also discussed in the Customer Centric Circles.

  1.       Continuous Customer Improvement Program CCIP

This then leads to an ongoing CCIP and with follow-up meetings of the Customer Centric Circles to see if progress is being made, where the system failed and what further improvements to make.

  1.         The Customers Bill of Rights

The Customer Centric Circles start to look at the Customers Bill of Rights, whether they are valid or should change, whether the rights can indeed be honoured, and if they are not being honoured what prevented them from happening and the preventive action.

  1.        The Circle of Promises

An examination of the Bill of Rights with the staff people shows that many other people in the organisation are involved with making the Bill of Rights a reality. These people are invited to the Customer Circles and often become an important part of it.

The staff people work with higher layers of management in making this happen and in changing the mind-sets.

 Service Culture at top levels:

As we said earlier, the service culture has to be present at the top levels.

What do we need to do?

  1. Build the CEOs self-esteem or self-confidence (self-value):

The CEO has to stand up against the short termism dictated by many shareholders. Just as frontline people have to present the company’s Customericness to Customers, the CEO and the CXO have to present to the shareholder team why long termism is important and why Customericness or the Customer culture will lead to better business results. Only CEOs with a good self-confidence can do this.

  1.      Inculcate the Service Culture at the top levels:

This has to be done with a Customer strategy/service strategy that brings all C-suite and VPs/senior GMs into the Customer strategy building and their sharing various tasks. Thus the head of manufacturing may also be in charge of the Customer First strategy, and the tactics associated with it.

  1.     Lead from the front:

CEOs and CXOs must spend 15% off their time or more on Customers. They should take one call a day coming into the call centre. They will then get a better sense of the Customer and his needs, and whether the call centre response system is adequate or requires changing. They must become part of getting the Customer to love their company.

  1.    Measure Customer scores and report them in to drive bonuses:

By linking bonuses to Customer scores, and reporting them to the Board of Directors along with the financial scores is a great idea. Companies like State Farm and Castrol report Customer Value Added scores, coming from the Customer.

The Customer Value/Customer Centric criteria can form part of the Balanced Scorecard. Many of our clients have Customer Value Management as the top item some as high as 25%

Doing all this will make the service culture emerge as important and the company will become Customer-centric.

Does this make sense, Jim?

 

Gautam Mahajan,
President, Customer Value Foundation and Inter-Link India

Founder editor, Journal of Creating Value jcv.sagepub.com
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226
mahajan@customervaluefoundation.com
www.customervaluefoundation.com
http://www.interlinkindia.net

Twitter @ValueCreationJ

Customer Value Foundation (CVF) helps companies to Create Value and profit by Creating Value for the Customers, employee and for each person working with the companies.

Total Customer Value Management (Total CVM) transforms the entire company to focus on Creating Value for the Customer by aligning each person’s role in Creating Customer Value and getting shareholder wealth and Value.