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What Do You Do for Your Customers?

This may be the single most important question you must answer to be successful. Define your answer not in terms of activities, but of results—results that are important to your customers. For example, staffing (such as providing temporary employees) is an activity. But results for the customer would include lower staffing costs and absenteeism, higher quality output and greater productivity, reliability, getting qualified people quickly, and a highly motivated, flexible workforce.

You should focus on results that differentiate you from everyone else. Standing out in a world of many choices is critical to your success. Regardless of what you do, at some level you are delivering results to others. Your success will depend on how those people perceive the value of the results you deliver and how unique those results are. Being clear about what it is you really do for your customers is the only way you can deliver it. You must answer the question about what value you bring to the customer, what you add that wouldn't otherwise be there, and why that is important to the customer.

When I first went out on my own, someone asked me what I did. I responded with "I'm a consultant," and as I said it I unconsciously raised my shoulders. I realized later that I had raised my shoulders because I really didn't have a specific idea of what I was going to do. Being a consultant covers a wide spectrum. In my former job, being a generalist was a good thing. But if I was going to solve customer problems, I needed to focus: what type of problems would I solve, and for what type of customers?

Value Propositions

A value proposition is a statement of the value you promise to deliver to a customer who purchases your products or services. It is the unique set of benefits you can deliver to a customer; it's the list of reasons the customer should buy the product or service. Because it proposes a promise, I recommend you think of a value proposition as a value promise, the promise of the value you will deliver to the customer. Thinking of this as a promise positions it in your mind with the weight it deserves. The value you promise becomes paramount in directing all of your efforts to meet that promise.

A customer picks a specific product or service because of the value he or she thinks will result from that choice. The customer may or may not see all of the results as valuable, but will make the purchase if there is a favorable or compelling reason to select the seller at that time. Value is in the eye of the beholder and is very much dependent on the customer's circumstances and experiences. Value isn't limited to monetary results. The customer can value different aspects of your product or service, such as reliability, convenience, ease of use, or durability. The value that you add as an individual to the service is another part of the picture. The customer can value these attributes individually or in combination. Your value proposition should clearly explain what you do for your customers and what makes you unique or different from other suppliers.

More than anything else, a value proposition can help a company focus on what it really does for its customers and what those customers really want. It is a way of thinking clearly about what the customer's priorities are. If a value proposition is based only on the seller's views about what is important to customers, it may miss the mark. A technology company may see its value as delivering technology, but do their customers see that? Or do the customers see beyond the technology to other results? The perceived value will also depend on who the customer is in an organization.

Here are three points to consider in defining your value proposition:

  • What do you do to solve customer problems?

  • How are your solutions special or unique?

  • What is your promise?

Keep in mind that value relates not only to the tangible and intangible benefits of your product or service but also to what your product or service does for the customer personally. That is often more important than other factors when the customer makes a purchase decision. If my job depends on whom I select as a vendor, how I think your solution will help me personally will be high on my list of considerations when I make a decision to select a vendor. I may not let others know of this, but it will be relevant. For example, the customer may want to be perceived in any of a number of ways by his or her organization: proactive, cost or quality conscious, a leader, or a tough negotiator.

You must be able to understand and communicate to your customers the value that you bring. A well-conceived value proposition is instrumental to customer satisfaction and loyalty and company profitability and growth. Well-planned communication is essential for you to create and sell a compelling proposition for the value you bring to customers.

One senior executive at a major company has a unique method for providing prospective representatives with his company's value proposition. Rather than simply telling them what it is, he asks them what they would expect in a relationship with a company that they would want to be associated with. They usually cite such desirable qualities as quick response time, competitive policies, strong service, and stable pricing. The executive then responds that they have exactly described his company's value proposition and then invites them to call any of the other representatives in his network. This company is quite selective in choosing representatives because it wants to maintain an extremely high level of service and it looks for the same level of commitment from its representatives.

" Great value-added propositions in this world start not from liberty and license but from need and want and hunger. Breakthroughs come from limits."

—Paul Hawken, cofounder and chairman, Groxis; also founder of Erewhon Trading Company, Smith & Hawken, and Metacode

What is it you do for your customers? What results do you get for them? Do you have a value proposition or have you in some way described the results from the customer's point of view? If not, there is no better time than now to begin to describe your value proposition. Be sure to distinguish between the activity and the result. Describe an activity, then a corresponding result.

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