THE VALUE EQUATION
The key questions to ask when trying to leverage people, data and technology that delivers business results, while 'doing the right' thing for humanity and our planet are:
1.Is it desirable? 2.Is is viable? 3.Is it feasible?
If you are going to answer these questions you will need a formula that allows you to make the appropriate changes while still driving value for all involved – this is the Value Equation.
Let’s first start with results. All organisations are responsible to drive results. It is how we measure success. But the question is how we get results or even more, how do we get better results.
Organisations really exist to serve the needs of their customers. This is why organizations produce a product and/or a service - so that they can meet the needs of the customer and the markets where they exist. A proposition is intended to drive value for the customer. That is why we use the term Value Proposition, as it’s a proposition delivered by the provider in order to meet the needs of the customer.
These customer needs range from functional needs all the way to emotional needs. Results and Needs are the two sides of the Value Equation. But how do we actually derive results using this equation?
Behaviours actually deliver results, and what I am talking about are the behaviours of the customer. If you want to drive conversion rate then you need more customers to push the buy button which is a behaviour. If you want to drive retention than you need customers to actually stay - which is a behaviour. If you want to drive down contact center costs and you want people to use more self-service, then what you want is for customers to stop calling and for them to start using the online help. That is a behaviour. Behaviours deliver results. But how do you get the desired behaviours that deliver results?
What drives behaviours is the attitude of the customer. What they are thinking, whether they are in a state of direct consciousness or not, is how the next set of behaviours will unfold. These attitudes have a direct connection to human desire to fulfil needs. If my needs are being met, I will react in one way, and if my needs are not being met, then I will react in another way.
So our goal as an organisation is to understand the lifecycle, journey, and moments of interactions that a customer has in the pursuit of fulfilling their needs. In addition, we need to ask how we might engage with them differently in those moments in order to better assist customers as they fulfil their needs.
The reason these moments of engagement are so crucial is that they are the format to delivering to customer’s needs. Our experiences are the perception of that interaction and whether it met my useful, usable and meaningful needs or not. Unfortunately, businesses are so focused on the word experience that they forget how important it is to understand that businesses cannot control perceptions but can control interactions.
These perceptions are framed by my expectations of how my needs were going to be met at the critical points of interaction. What is the context of the situation? What previous interactions have I had with this brand and others? What trends are relevant at this moment of interaction? What is my Persona? These and other factors form the foundation of how I will perceive this interaction. Every experience going forward will shape my expectations of the future. Expectations do not have to be realistic, but they are still real and must be taken into consideration. This is the formula from the Customer’s side of the equation, so the next thing to ask is what is the organisation’s role in this equation.
What you can control are the activities and propositions that your brand executes at these moments of interaction. For activities, I mean being clear about the tasks, processes, methods that engage directly with the customer (on-stage), as well as the activities that are back-stage but relevant to the delivery of the direct activities. All of these must be aligned to meet the needs of the customer.
Now you can align the resources you need such as people, technology, tools, intellectual property and more. Whatever it takes to deliver those activities and propositions to meet those needs. You can also look at enabling those activities yourself or being part of an ecosystem and partnering with others in order to execute those interactions.
Overall this Value Equation represents the process you should use to make sure any ‘curiosity’’ drives better results and to an advantage for your organisation.