What is value? What is a customer willing to pay? Since Lean Thinking and Lean principles are around, many organizations strive to bring more value to the customer. But apart from reducing costs what levers do they have to bring more value to theirs customers?
The article titled “The Elements of Value” published in the HBR september 2016 issue by Eric Almquist, John Senior and Nicolas Bloch, brings no less than 30 answers to these questions.
I strongly recommend to read the article. The online issue can be read here: https://hbr.org/2016/09/the-elements-of-value
In this post I summarize the very minimum about the 30 elements of value and share some of my thoughts about them.
30 elements of value
The authors, all three working for Bain & Company’s, have identified 30 “elements of value”, which are “fundamental attributes in their most essential and discrete forms”, that meet fundamental human needs. They classified these 30 elements into 4 categories stacked on a Maslow’s “hierarchy of needs” inspired pyramid to organize the elements of value according to their relative “power”:
- life changing,
- social impact.
Similarly to the popular assumption that (in Maslow’s model) people cannot attain the needs at the top until they have met the ones below, to be able to deliver on higher-order elements, a company must provide at least some of the functional elements required by a particular product category. But many combinations of elements exist in successful products and services today.
A comprehensive cheat sheet for entrepreneurs
I really liked the way the authors presented their findings and I thought this is a nice comprehensive cheat sheet for entrepreneurs, startupers, managers, and for everyone seeking to enrich their value proposition.
What can I do to relieve the pain of my customer? How to bring her some gain? How can I extend our offering? Have a look on the 30 elements and check if the answer to these questions isn’t among them.
The HBR article gives some examples among which Amazon prime. It describes how the service went from its initial shipping offering for $79 annual fee to an extended offer at $99 within 10 years, while conquering significant market share of the U.S. retail market.
I think the 30 elements may find their way into the graphic toolbox started by Strategizer with the Business Model Canvas and the Value Proposition Canvas, as a checklist, a cheat sheet, or seeds for creative brainstorming.
Entrepreneurship is not only for the startupers. Those wanting to reinvent or reinvigorate their business, those who want to keep competitors at a distance or those worrying about a possible business disruption may wisely invest some of their time reflecting on the 30 elements of value as well.
There is probably more value in the article than what I report here. Feel free to share your thoughts in the comments.
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