The unique value blend section of the strategic choices canvas.
Value driver attributes to consider for your unique value
blend
Value driver attributes to consider for your unique value
blend
Choosing How to Succeed . . .
Creating delight with your unique value blend
The most successful businesses in the world do not satisfy
their customers, instead they delight them.
iPhone users do not like their phone they love it. Tesla owners
do not like their car, they love it.
Your unique value blend plays a significant role in increasing a
customer's delight and subsequently willingness to pay by making the
product or service
stand out from alternatives by creating a differentiated
delightful value proposition.
"We see our customers as invited guests to a party,
and we are the hosts. It’s our job every day to make every
important aspect of the customer experience a little bit better.” Jeff Bezos.
A good business serves its’ customers and satisfies many of them.
Consider, as an example the mobile phone industry prior to the iPhone.
Nokia and Motorola were good businesses and market leaders.
The products they created satisfied their customers.
Then along came the iPhone and quickly behind it the Google backed
Android variation smartphones.
These phones did more that satisfy the market,
they delighted and excited consumers,
and the market for Nokia and Motorola product, all but vanished.
Google search - delights
Google has emerged in western developed countries as the dominate search engine.
Prior to Google there was Altavista, Excite, Yahoo, Ask Jeeves and so on.
All these search sites
contained slow loading pages packed with
alternative content. Subsequent, search results
were mediocre at best.
Alternatively, the Google search page was and remains simple and people
do not just get satisfying search results that they might have gotten with the
now irrelevant predecessors, they get search results that are delightful
relative to previous offerings.
Delight the foundation of excellence
Aiming to serve and satisfy customers is a path to mediocrity.
Mediocrity does not engender loyalty, trust, or respect.
Great businesses do not want to serve or satisfy their customers,
they want to delight them.
Apple famous historically under
Steve Jobs for its obsession on a delightful customer experience in
every dimension from interest, usage, return and trade-in of its products.
McDonalds does not want to serve its customers
it wants to be its customers’
favorite place to eat no matter where they are.
The Virgin group’s most fundamental strategy
has been to find industries that had offered standardized (and substandard)
customer experiences, launch rival
offerings differentiated by being cost competitive with Virgin style delight
and of course it has been
stunningly successful.
Jim Collins in his book, Good to Great, reminds us that if we settle
for good, then we can never have great. Hence, the problem with aiming
to only serve or satisfy, is the decisions necessary to create delight
do not or will not get made.
Serving and satisfying require being good, delighting requires
working toward greatness and continual improvement.
IKEA is an incredibly successful furniture retailer.
What is the unique blend of value that makes it so successful?
Consider the following candidate list
Product fulfilment is immediate, that is, the
customer can take anything they buy home on the same
day. No waiting weeks for distribution
Large showrooms with plenty of onsite parking.
Often with budget meals and child care accessible
Uniqueness
Unique Scandinavian design.
Styles are rarely available from rivals.
Confidence
Consumers can see and experience
the furniture assembled
in integrated aesthetic displays in low pressure
(no sales people) showrooms that seem more like an
adventure rather than shopping.
The furniture is of good quality in terms of durability.
Consumers can have affordable furniture that does not look
cheap in their homes
IKEA provides a huge range of products for just about any
home furniture / decorating needs, so consumers feel confident
they can find what they are looking for at IKEA.
IKEA provides a trusted brand reputation.
Amazon, after years of selling books has emerged as the
everything store in many countries.
It is an incredibly successful online retailer.
What is the unique blend of value that makes it so successful?
Consider the following candidate list
Affordability
Amazon products are price competitive for just about
any product it provides
Convenience
Easy to search for and find products, selection
is assisted by quality product descriptions, images
and customer reviews.
Huge range, customers can get just about any product
that can be sold online from Amazon
Easy and fast checkout - Amazon patented the one click
checkout
Suggestions based upon on current search or previous
purchases that are of interest and relevant.
Confidence or trust
Amazon delivery is consistently fast and reliable, often
with package tracking.
Returns policy means consumers can be more confident in
return products do not meet expectations.
A unique value blend often applies across your products / services.
Your unique value blend may apply to your brand or to a
particular product, product line or service.
How the customer feels is the fulfilled
by a set of
quality attributes to create the feeling.
It is that singular or mix of feelings that create that delight. For
example, the customer felt confident in the solution.
The quality attributes creating that confidence might be:
Convenience - easy to acquire
Ease of use - customer experience confidence and
competence due to ease of use.
Knowledgeable staff provided responses to customer
uncertainties.
Warranty and refund policy.
You will often want to ensure your
quality attributes consider how you want the customer to feel such
as confident, autonomous (independent), desirable, important,
respected, appreciated etc.
Step 1
Choose a quality attribute e.g. Performance, flavor, convenience.
StrategyCAD provides about 20 different quality attribute suggestions.
Choose a quality attribute.
Identify the meaning the quality attribute has either singularly
or as part
of your unique value blend for the customer. If something has better performance
what does this mean for the customer. Does it fulfill a desire to
be and have the best? Does it fulfill to increase security by reducing
the time and cost of completing a task? What meaning or value does the
quality attribute have for the customer?
Identify what the attribute means in terms how the customer
will or wants to feel.
Priority
In terms of creating the overall value blend, how important is this
quality attribute in terms of its contribution. A lower score means
it plays a smaller role in the value blend. So for IKEA or any business
who is applying a cost leadership strategy, price will be part of the
Unique value blend and will usually play a substantial role. Whereas,
for a premium differentiated product e.g. Harley Davidson, Ferrari etc,
price will play a smaller role if any in the Unique value blend.
Here you can identify what you need to do in order to provide this
quality attribute. This step informs what you need to do
in your integrated value chain and potentially guides the
tangible and intangible resources necessary to create your
unique value. For example, IKEA requires capability in
unique design of flat packaged furniture that can be mass-produced
by external suppliers as a capability.
You can partition features into one or more of the four categories, shown
in the screenshot and available in the table below.
Identify what needs to be done to enable the attribute.
Prompt: How well are we doing?
Provides a quick strength or weakness assessment for the current
capability of the business to fulfill this attribute. If it is
being done well then a sustain strategy is likely relevant. It it
requires improvement, then consider what needs to be done in the value
chain to deliver the attribute.
To augment the features and meet the customers needs, improve the
customers' situation and fulfill aspirations, consider
differential quality attributes required of the offering.
You can partition quality into one of the four categories. In StrategyCAD
you can rename any of these to custom the quality attributes to be what you
need.
Defining the necessary qualities of the offering to fulfill the offering purpose,
objectives
and contribute to the Unique Value Proposition.
Based upon the score in the previous step, identify
anything that needs to be reviewed in order to deliver
this value blend attribute.
Consider the organizational values, resources
or capabilities that are necessary to deliver
this attribute.
Based upon the score in the previous step, identify
anything that needs to be improved in your value
delivery chain in order to deliver
this value blend attribute.
Identify what needs to be improved to
deliver this value blend attribute.
Review your overall value blend and the role of
each attribute in it to ensure it creates the feeling
of delight you want your customers to experience.
Ensure each attribute is present and necessary.
Use the information to guide and focus your integrated
value chain, and assure the resources and capabilities necessary
to create delight are provided.
"The companies that perform best do not think about themselves first and foremost.
They dream up ever better ways to create value for others.
Think value, not profit, and profit will follow.”
Felix Oberholzer-Gee, Andreas Andresen Professor of Business Administration in the Strategy Unit at Harvard Business School
A PESTEL analysis and industry assessment are crucial
components of any business strategy for
understanding of the external factors that can impact a business.
You can conduct an assessment, for Political,
Economic, Social, Technology, Environmental and Legal
influences
by
Arena (industry and geography) - see the Discover
opportunities and threats section. Use your PESTEL
assessment
to identify potential opportunities and threats, and
develop strategies to capitalize on emerging trends,
and mitigate risks.
PESTEL assessment to identify opportunities and threats
within an environment e.g. geographic
Internal assessments
An industry assessment is valuable to identify
the factors influencing industry competitive forces
and profitabilty. It is an important determinant
of decisions to enter, exit or how to compete
in different industry arenas.
You can conduct an assessment, for each of the Five forces
by
Arena (industry and geography) See the Assess Industry profitability
section of that page.
You can use the Five forces assessment tool
to identify potential industry based opportunities and threats, and
develop strategies to capitalize on emerging trends,
and mitigate risks.
Industry assessment to identify competitive opportunities and threats
within an industry environment e.g. geographic
Competitive assessments
You can identify opportunities and threats by
evaluating your value proposition, value blend or
capabilities and resources relative to your competitors.
This assessment is done within a strategy implementation
to identify where the strategy needs to focus to succeed
relative to the competition. This may influence goals
within the customer value or process or capability enablement
section your balanced scorecard.
See
the scorecards section of the StrategyCAD guide, for more information about
working with scorecards and assessment. See the
Assessment section
for more information about competitive, product and related assessments.
You can configure scorecards to assess different criteria
and maintain assessments
across multiple dimensions including time to track performance.
Competitive scorecard to identify competitive opportunities and threats
Consumption chain
assessments
You can identify opportunities and threats by
evaluating the consumption chains of your business and/or products.
A consumption is the series of steps a customer needs to go through
to become aware of, identify the desire for, purchase, acquire, setup, use,
acquire support, and eventually dispose of your product or service.
A consumption chain assessment allows you to assess how easy or difficult
your consumption chain is at different points and the identify opportunities
to be easier to find, or do business with.
This assessment is done within Customer assessment
section of a strategy implementation
to identify where the strategy needs to focus to succeed
relative to competition which will influence goals
within your balanced scorecard.
See
the scorecards section of the StrategyCAD guide, for more information about
working with scorecards and assessment. See the
Assessment section
for more information about competitive, product and related assessments.
You can configure scorecards to assess different criteria
and maintain assessments
across multiple dimensions including time to track performance.
Consumption scorecard to identify competitive opportunities and threats
related to how easy or difficult it is for customers to discover,
and exchange value with your business.
Preparing team alignment with the McKinsey 7S Model
McKinsey & Company, a management consulting firm,
created the 7-S model to help client companies successfully
implement their strategies.
It was later featured in the book In Search of Excellence,
by former McKinsey consultants Thomas J. Peters and Robert H. Waterman.
The model highlights 7 important elements of organizational design to
create the alignment necessary to implement the business strategy.
The 7 S’s are: Strategy, Structure, Systems, Skills, Staffing, Style
and Shared Values.
McKinsey 7S scorecard which can be used to assess and
then drive internal alignment and capability opportunities
and improvements.
See
the scorecards section of the StrategyCAD guide, for more information about
working with scorecards and assessment. See the
Assessment section - Internal assessment
for more information.
You can configure scorecards to assess different criteria
and maintain assessments
across multiple dimensions including time to track performance.
Preparing team alignment with the Galbraith Model
The Star model, like the McKinsey 7s Model
helps you and your team successfully implement your strategies.
The model highlights 5 important elements of organizational design
to create the alignment necessary to implement the business strategy.
The 5 elements are: Strategy, Structure, Processes, Rewards and People.
The Galbraith Model scorecard can be used to assess and
then drive internal alignment and capability opportunities
and improvements.
See
the scorecards section of the StrategyCAD guide, for more information about
working with scorecards and assessment. See the
Assessment section - Internal assessment
for more information.
You can configure scorecards to assess different criteria
and maintain assessments
across multiple dimensions including time to track performance.
Preparing your ecosystem to support strategy implementation
You can quantitatively assess your ecosystem
(suppliers / partners) capabilities and resources
using the ecosystem
assessment / scorecards for one or more of supply chain, partnerships or
free form (an assessment of your design).
The Ecosystem asessment and scorecard can be used to assess and
then drive internal alignment and capability opportunities
and improvements across your ecosystem.
See
the scorecards section of the StrategyCAD guide, for more information about
working with scorecards and assessment. See the
Assessment section - Internal assessment
for more information.
You can configure scorecards to assess different criteria
and maintain assessments
across multiple dimensions including time to track performance.
Preparing your focussed effective implementation
Your diagnosis is part of what might be called root cause analysis,
or the top of the 5 whys. Your diagnosis aims to create
leverage in your strategy implementation; that is, by
addressing the big rock opportunity or the big anchor constraint
then the business performance improves most substantially. Competitors
can play at doing 10, 20 or 100 different little or medium things, but
the diagnosis creates the opportunity to address the root issue.
Example in the 1990's Lou Gestner took over a very troubled IBM.
The technology industry was fragmenting and many experts indicated
the IBM needed to be broken up to align with the overall industry
fragmentation. Gestner, however made a different diagnosis.
His diagnosis was that IBM needed to become more integrated to be
prepared to provide customers with integrated solutions rather than
fragmented pieces of technology. That diagnosis set a completely different
policy and action plan than one of IBM needs to fragment.
To prepare for a focussed and leveraged Strategy implementation,
following your assessment of internal capabilities, customer,
competitors and ecosystem, you can make and record
one or more diganosis.
See
the diagnosis section of the StrategyCAD implementation guide, for more information.
Preparing your focussed effective implementation
Your guiding policy is part of your strategy kernel the heart of good strategy.
Your guiding policy in StrategyCAD can include
1. Your organizational chart to describe organizational / team
structure reporting and supporting lines.
2. Preconfigured and customized policies
Do more, sustain, do less and eliminate policy matrix
All policies are essentially of this structure.
What does the business need to do more of and sustain to deal with the
situation in the diagnosis and what does it need to do less or eliminate
doing to make the capacity and deal with the situation in the diagnosis
Ansoff Growth Matrix
Ansoff Growth Matrix is an enduring Matrix for providing a policy
for how a business is going to achieve growth and recognizes
the level of risk in the growth policy
Additionally, you can create and configure your own policy
structure.
3. Roadmaps - that define the sequence of outcomes and the role
of the internal alignment topics e.g. systems, people, skills,
shared values or any other attributes you wish to add.
The balanced scorecard is a strategic management framework that helps
translate strategic objectives into specific performance measures and targets.
The framework provides a balanced view of
performance across four perspectives:
financial, customer, internal processes, and learning and growth
(capability).
1. As you add objectives to your implementation action plan
you can add them to a layer of your balanced scorecard to verify
the feasibility of your action plan.
You can answer the question and demonstrate
to your team(s) and stakeholders that
based on the actions in the scorecard your business can achieve
the desired business outcomes, by achieving uour customer outcomes
and those customer outcomes can be achieved with the process
and people objectives that have been set.
StrategyCAD Balanced Scorecard for demonstrably feasible
strategy execution
SMART implementation
Every objective in StrategyCAD is specifically structure to support
the SMART Goal / objective format.
SMART goals ensure the clarity created in the strategy ripples
into the goals / objectives of implementation.
StrategyCAD supports SMART objectives (OKRs) for all
objectives.
Introduction
IKEA
Amazon
Your Unique value blend
