Posted tagged ‘Value Creation in Education’

The 8 Principles of Customer Value Creation

September 9, 2016

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
K-185 Sarai Jullena, New Delhi 110025
+91 98100 60368, 011-26831226

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.

Are Companies Loyal?

December 29, 2015

I came across a cartoon at Economic Times, which showed two executives speaking and one saying:

It’s no more about employee loyalty… try winning company’s loyalty…

It got me thinking. Should a company be loyal? Can a company be loyal? To whom? I quickly googled, and there was hardly anything on a company’s loyalty.

The first question is an easy one, a company can be loyal.

Should a company be loyal is more complex, till we answer the question to whom.

I guess we have to scroll through the stakeholders: Employees, customers, partners, shareholders and society. The easy answer is that a company should be loyal to all of these. If this is true, then we have to ask are most companies you know loyal, and to whom? Are companies you buy from loyal to you? I have found that whenever we as Customers have been good and fair to our suppliers, they tend to be more loyal to us than to other customers who are not as fair or good to them.

I would imagine most companies tend to be loyal to their major shareholders. They generally show their loyalty to the shareholder by offering him what he wants most: dividends, stock price, long term growth and market leadership. I suspect most shareholders want either dividends or stock price growth. Thus the loyal management works on these aspects.

Are companies loyal to employees? Is this loyalty secondary to the loyalty to shareholders? This makes us think of the Japanese lifetime employment system (only 8.8% of Japanese companies have this now). There were three models: Stationary (governed by a set of rigid rules, and the expectation that some non performing employees would voluntarily leave), Growth (depends on organisational growth, and all grow with the organisation), stagnant (where the company when in bad shape let’s employees go) …Assuming employees were given life time employment, what value was this loyalty? Apart from a somewhat guaranteed employment, this system did not allow employees to easily switch and they became captive employees. Was company loyalty good for employees?

Outside of Japan, I am sure there are examples of companies being loyal to employees. I cannot think of many. We also notice that companies work on making employees loyal. One way is to make the employee feel indispensable. Or by giving golden handcuffs…If you leave you will be worse off or lose bonuses, or stock options.

The less said about true loyalty to customers. As long as the customer can be milked (can buy), he is worthwhile. In this instant gratification society, even this is short lived. Also, as I mentioned earlier, there is some loyalty to customers who are good to them.

I had written about company loyalty to suppliers, and that too is minimal and based on the benefit to the company (sometimes called mutual benefit). This loyalty is generally purchasing department led, though it is true mutual bonds between the supplier and the end user in the company do form.

The company’s loyalty to society and to sustainability has yet to be proved. There are examples of Unilever and others who are trying to be loyal to the environment and sustainability

So, the company is loyal to the Owners…in reality!

How can they change or be otherwise. Others have written that the company has to think of itself first. I think this is true for survival (first put the oxygen mask on yourself, and then on the kids…but not put the oxygen mask on yourself and abandon the kids). So instead of abandoning the other stakeholders, companies try to sustain them to the extent their loyalty to the owner will let them.

Many Customer consultants would want the company to be customer-centric. Does that include company loyalty?

I think company loyalty and customer-centricity is a thought process and requires enlightened owners, and enlightened managers, who look beyond profit being the purpose of a 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                                                                                                              Founding Editor, Journal of Creating Value,

President-Customer Value Foundation
M: +91 9810060368
Tel: 11-26831226, Fax: 11-26929055

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.

Example of Value Creation in Education

May 29, 2014

Example of Value Creation in Education: At the Michener Center, U of Texas, Austin 

As many of you know, I have been writing about Value Creation in education. Much of the discussion has been generic. That the role of a teacher is to go beyond just imparting knowledge but to create value by showing the student how the knowledge is used by others, what they do with the knowledge, and how the student can use the knowledge and benefit from it and enhance his environment (employer, society etc.) 

A few days ago I had the privilege of witnessing this Value Creation in action. This was at the Michener Center at the University of Texas at Austin. The Michener center has assembled brilliant talent in fiction, screenwriting, poetry and playwriting. Students in the MFA (Master’s of Fine Arts) were graduating, and the graduating class spoke about their amazing, life changing experience. 

The one thing all those graduating said was that the teachers and staff just gave and gave and the students just took and took. The giving was selfless. I wondered what value was being created for the teacher. Was it just satisfaction? Was it more, the pleasure of helping people become creative and successful? And I remembered my article that creative people did not need incentives for creating and helping others create value. Incentivisation does not increase creative power, but may create the environment (like the grants to the students). But the teachers were not incentivized by higher salaries for creating the value they did. They gave because that is the nature of secure and creative people to create more value, and to get satisfaction from doing a better job than others. 

The students went on to talk about how their fellow students created value for each other—by example, when they wrote or did something well; by witnessing the disappointment and disillusionment and the lows their fellow students experienced, and helping each other to get going and try again; by giving emotional support. Much like what the teachers gave them. 

The teachers gave them the enthusiasm, the secure environment, the emotional strength to go through the winning and losing, and helped them manage the emotional highs and lows. The staff gave them emotional support in their private lives, their special needs etc. and a sense of being part of a family and being at home. 

But what was common was building the sense of security in the students, when they felt insecure, inadequate and unable to cope, or unable to find that whiff of genius that could help them with a flow of brilliance, and happiness. 

What struck me were the enormous emotional bonds that the students had formed with the teachers and their fellow students, the gratefulness to them. Many cried, as they related their story of growing at the Michener Center. 

I had written earlier about the need to be secure to create value. Insecurity can come from when you are growing up or in your work or personal environment.  And so the teachers and staff created the environment for fostering talent and security. 

One teacher told me that the students were inherently talented, and the teacher’s role was to make the student use the talent and grow. An environment of trust, of belonging, of self-belief, of relying on colleagues and helping each other (creating value for each other), by building emotional strength and bonds helped the students rise to their inherent abilities. And that is what the teachers did. They also helped the students to unlearn so that they could learn faster. 

And the importance of unlearning and learning and unlearning. 

So this is an example of Value Creation in education by teachers and students, and how you too can create value. 

It is not incentives! It is not self aggrandizement that makes creative teachers create value. The students too will realize that their creativity will flow despite incentives or lack of it…and as they grow, they will find that if they can create value for their readers, by getting them to learn, or to get an emotional bond with the writer, or making the readers feel good about themselves. Then the writer will become even more successful. 

As one teacher said, when you leave, walk backwards so that it appears you are coming in. Or that you are still with us and you belong. 

And when you walk away, ask if it is the experience or the memory of the experience that was more important. 

And if you as students and teachers consciously start to think of value creation as your role, you will find that all of you will enhance your offerings because now you have added yet another dimension to your creativity and work. 

Will you, the student become a value creator? Will you use the special ability the teachers helped you find and hone to become value creative writers? 

With special thanks to some unusual value creators: Jim Magnuson, Elizabeth McCracken, Michael Adams (all of whom I met), the other students and staff of the Michener center. 

Your comments are welcome. 

Call at (+91) 9971288580

Gautam Mahajan, President-Customer Value Foundation
M: +91 9810060368
Tel: 11-26831226, Fax: 11-26929055

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) transform 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 Creation in Education

December 21, 2013

In my last note I wrote about Value Creation in non B-schools. I met with Dr Kavita Sharma, Director of the India International Center, and formerly Principal of the prestigious Hindu College of Delhi. I paraphrase our conversation and Kavita’s comments.

Kavita told me that before we start to look at how to create value for students, we must understand what value means to them. Value is very personal: it is a feeling of a sense of fulfilment. And some of it comes from a sense of ownership (of one’s life or job), a sense of involvement, of fulfilling a vision (if you have one).

For a student, it could be “am I employable?” and value creation could help him with “how can I become employable?”

And so campus interviewers have to ask what the student considers value and how will you create value? What are you passionate about? What keeps you or will keep you awake at night?

And for employees it is a sense of involvement that creates value for them. The employee’s sense of ownership adds value to the company What can I do to make my job better and get better results for the company, how do I take pride in doing things better? How do I take the extra step?

How does one marry the individual aspiration to the organisational aspiration? And to create Value?

As an example, a business owner’s child may wish to make films, but the father can only see the kid in his business. Both have to understand the key to adding value for each other.

So teachers and executives have to go through refresher courses, and understand the question of value creation. And they have then to suggest how students can use the learnings of the course to create value for themselves and their employer and society at large. And students should start to think about value creation as their role rather than just to be subject learners.

What do you think about “Value Creation” as a part of education system? Your comments are welcome.


Call at (+91) 9971288580

Gautam Mahajan, President-Customer Value Foundation
M: +91 9810060368
Tel: 11-26831226, Fax: 11-26929055


Teaching Value Creation

December 10, 2013

You might have noticed our main Value Creation discussion in education has focused on business schools. In fact we are developing course content for a Value Creation major in MBA schools.

A few days ago, I had a discussion with an Economics Professor. She was telling me about the various courses she teaches. I asked her if she talked about Value Creation to her students. How would they use their knowledge? How would they create value for themselves, their employers, and the society at large?

Her eyes sparkled with interest. This was a new facet of teaching she had never thought about. She felt it was a great idea, and something she must include in her teaching.

She asked about simple examples of Value Creation she could give her class. I told her about my assistant who sent an Income tax notice on my behalf to my tax lawyer. A few days later, I asked him if he had confirmed if the tax lawyer was going to attend the hearing, He had not. If he had confirmed the attendance of the tax lawyer, he would have created value for me. You can find so many examples of value creation. A customer services person solves a problem for me. He realises this problem is prevalent, but he does not try to get the company to change the process/procedure so that other customers do not face the same problem I did. He missed a chance to create value for the customers, his company and himself.

There are just as many examples of value destruction. The run around you get when you call a company to complain is a typical example. A taxi cab that comes later than ordered and makes you almost miss a plane. A service person who does not arrive when promised. The list is endless.

The first step to companies and executives converting to Value Creation is awareness. Awareness that they can create or destroy value, and what they can do to create value is necessary and has to be taught. The concept has to be taught to college faculty, and to companies’ senior executives, so that they can teach value creation and set up an enabling environment.

What do you think? We welcome your comments.