curve - Blog - Global Risk Community2024-03-28T12:29:15Zhttps://globalriskcommunity.com/profiles/blogs/feed/tag/curveWhat Makes a Value Proposition Truly Compelling?https://globalriskcommunity.com/profiles/blogs/what-makes-a-value-proposition-truly-compelling2016-08-01T20:22:20.000Z2016-08-01T20:22:20.000ZDavid Tanghttps://globalriskcommunity.com/members/DavidTang<div><p>First, let’s define <a href="https://flevy.com/browse/flevypro/customer-value-proposition-2369" target="_blank">Value Proposition</a>. Here’s what Wikipedia has to say:</p><blockquote><p>A value proposition is a promise of value to be delivered and acknowledged. Creating a value proposition is a part of business strategy. Kaplan and Norton say “Strategy is based on a differentiated customer value proposition. Satisfying customers is the source of sustainable value creation.”</p></blockquote><p>Why is having a clear and compelling Value Proposition so important?</p><ul><li>It solves a customer problem or satisfies a customer need.</li><li>It is the reason why customers turn to our company vs. a competitor--i.e. it is a source of Competitive Advantage.</li><li>It is the foundation to a company’s business model--other components include Profit Formula and Key Resources & Processes.</li></ul><p>Most companies believe they already have a compelling Value Proposition--a product offering that’s the best thing since Pokemon Go. <em>But, do your customers agree? </em>Is there a disconnect between the value as defined by you (i.e. Customer Value Proposition) and the value as perceived by the customer (i.e. Customer Value Perception)? This disconnect is known as the the <strong>Value Perception Gap</strong>.</p><p>To close the Value Perception Gap, we need to have an offering that is truly compelling. A compelling offering must both</p><ol><li>demonstrate high value to the customer (customer says, “I need” or “I want”); and</li><li>be highly differentiated (customer says, “the alternatives aren’t as good”).</li></ol><p>A useful tool for determining those attributes that fulfill these criteria is the Value-Differentiation 2×2 Matrix, which defines categories of offering attributes:</p><ul><li><strong>Table Stakes -</strong> Features that are important to customer, but are provided by all competitors at a similar level.</li><li><strong>Game Changers -</strong> These are the must-haves that allow you to truly craft a compelling Customer Value Proposition.</li><li><strong>Neutrals -</strong> Features that are irrelevant to consumers.</li><li><strong>Fool’s Gold -</strong> These are distinctive, but do not drive true value. These “nice-to-have” attributes alone will not meet the customer’s basic needs.</li></ul><p><a href="https://flevy.com/browse/flevypro/customer-value-proposition-2369" target="_blank"><img class="center align-center" src="https://media.licdn.com/mpr/mpr/shrinknp_800_800/AAEAAQAAAAAAAAl6AAAAJDVjZjBkNTZlLTllZjYtNDQ5ZS1hNzQ4LTQyYWU4MzQ4ZTY4Ng.gif" width="640" height="480" alt="AAEAAQAAAAAAAAl6AAAAJDVjZjBkNTZlLTllZjYtNDQ5ZS1hNzQ4LTQyYWU4MzQ4ZTY4Ng.gif" /></a></p><p>At a minimum, we must have the Table Stake attributes. Without these, we aren’t a viable player in the industry, as we are not even meeting the customer’s basic needs.</p><p>To differentiate ourselves in a useful way, we need to develop the Game Changer attributes. Game Changers score high on both Value Proposition and Value Perception, thus minimizing the Value Perception Gap.</p><p>Many companies spend time and effort developing and marketing the Fool’s Gold attributes. While these attributes may also make the offering highly differentiated, the customer don’t need these bells and whistles. Companies that create offering with these features don’t have an accurate understanding of what their customers truly need. These offerings (and companies) don’t last.</p><p><a href="{{#staticFileLink}}8028250263,original{{/staticFileLink}}"><img width="750" src="{{#staticFileLink}}8028250263,original{{/staticFileLink}}" class="align-center" alt="8028250263?profile=original" /></a></p><p>Another powerful framework for identifying and prioritizing those attributes to create an offering of high Value Differentiation is the <strong>Value Curve.</strong> (The Value Curve is at the foundation of <a href="http://flevy.com/blue-ocean-strategy" target="_blank">Blue Ocean Strategy</a>, an innovative growth strategy framework for creating an uncontested market space.) The Value Curve allows us to allocate our resources by answering the questions:</p><ul><li>Which of the attributes that our industry takes for granted should be eliminated?</li><li>Which attributes should be reduced well below the industry’s standards?</li><li>Which attributes should be raised well above the industry’s standards?</li><li>Which attributes should be created that the industry has never offered?</li></ul><p>Since we don’t have unlimited resources, we can only increase value on the Game Changers by reducing or eliminating cost of non-essential attributes.</p><p><em>What do you think makes a compelling Value Proposition?</em></p><p>You can download an editable PowerPoint about the <a href="https://flevy.com/browse/flevypro/customer-value-proposition-2369" target="_blank">Customer Value Proposition here on the Flevy</a> documents marketplace.</p></div>Why Knowing Flight Risk Scores for Current Employees is Too Latehttps://globalriskcommunity.com/profiles/blogs/why-calculating-flight-risk-scores-for-current-employees-is-too2016-01-22T17:00:00.000Z2016-01-22T17:00:00.000ZGreta Robertshttps://globalriskcommunity.com/members/GretaRoberts<div><p><span class="font-size-5"><a href="{{#staticFileLink}}8028241099,original{{/staticFileLink}}"><img src="{{#staticFileLink}}8028241099,original{{/staticFileLink}}" width="350" class="align-left" style="padding:5px;" alt="8028241099?profile=original" /></a>Greta Roberts, CEO, <a href="http://www.talentanalytics.com" target="_blank">Talent Analytics, Corp.</a></span></p><p></p><p><span>It’s exciting to watch advances in predictive and prescriptive employee solutions. Workday recently announced the release of an application enabling employers to “identify which employee is likely to quit, and what options need to be considered to retain that person”.</span><br /> <br /> <span>Workday is not the first to announce Flight Risk Scores of current employees. Many top Talent Management solutions have made similar announcements in the past several months. It’s a step in the right direction.</span><br /> <br /> <span>As exciting as these announcements sounds, I wanted to tease apart some of what we have learned that matters to businesses and their employee decisions. Perhaps frame how to interpret current innovations coming from the Talent Management industry.</span><br /> <br /> <strong>Is “Focusing Only on a Small Subset of Top Performers the Right Focus?”<br /></strong> <span>Businesses and their Talent Management Vendors seem to be obsessed about a small subset of top performers they are afraid of losing. Meanwhile thousands of bottom performers are hired, weigh down our organizations, turnover quickly and cost our businesses millions.</span><br /> <br /> <span>Of course businesses need to attack the problem from both sides. The most costly expense to mid to large businesses are frequently high volume, high turnover roles where thousands of employees are hired only to leave quickly or be a bottom performer. In both instances these new employees incur a massive cost to the business before providing any value to the employee.</span><br /> <br /> <strong>Flight Risk Scores for <em>Current</em> Employees is Too Late<br /></strong> <span>They are already hired. They are onboard. They are costing the organization without delivering value. A better approach would be to <a href="http://www.talentanalytics.com/optimizing-employee-lifetime-value/" target="_blank">predict how long a job candidate will stay, before you hire them</a> avoiding hiring those with a high flight risk altogether.</span><br /> <br /> <strong>Flight Risk is not a Single Score - See Graphic Above<br /></strong> <span>Employees in a specific role have different flight risks at certain times. Like saying the probability of machine failure is 78%. There is a missing piece of important context, which is “time”.</span><br /> <br /> <span>For a machine the probability of failure might be 32% at 6 months, 51% at 1 year and 78% at 2 years and so on. This Survival Curve gives the most accurate view of Flight Risk and enables the organization to be more sophisticated about their decisions.</span><br /> <br /> <span>Understanding that flight risk is a curve instead of a single point in time allows the organization to pinpoint when intervention is optimal and can save the most employees and the most money.</span></p><p></p><p><em>Greta Roberts is the CEO & Co-founder of <a href="http://www.talentanalytics.com" target="_blank">Talent Analytics, Corp.</a> and the Chair of <a href="http://www.predictiveanalyticsworld.com/workforce/2016/" target="_blank">Predictive Analytics World for Workforce</a>. She is also a Faculty Member of the International Institute for Analytics. Follow her on twitter <a href="http://www.twitter.com/gretaroberts" target="_blank">@gretaroberts</a>.</em></p></div>