In the midst of everything you do to keep your team running smoothly, a mindset where creating constant customer value as your top priority will improve your business exponentially.
Great Companies Strive to Spend 100% of Their Resources Creating Value
The ideal organization spends 100% of its time creating value. While spending 100% of your organization’s time creating value is theoretically impossible, great organizations strive to reach that goal as closely as possible. They create a culture where every employee from the top to the bottom is on board in thinking that way. Again, while this is simple in theory, it becomes more complex in implementation because it’s likely that a significant number of practices, business processes, and employee time spent doesn’t create much value to the customer at all.
Implementing a culture focused on creating value doesn’t have to be complex and difficult. By simply asking the question, “Does this create value to our customers?” you will begin to become aware of decisions that do or do not create value for your business. Whether you’re asking yourself or your team, developing this habit will result in a unified cultural focus on the most important goal in any company - profitability.
Value-Based Mindset in Action
One of our current project sprints is developing business processes and technology to support rapid growth for a client in the outdoor industry. They have respectable sales, three warehouses, and more than twenty dealers. The challenge is to develop a simple, integrated system with documented processes to run the entire organization, from marketing to shipping.
Our team consists of developers, strategists, operations, marketing, and finance specialists all working toward the same goal of simplistic integration. This talented team makes many decisions every day, both as a team and as individuals. Some are large decisions like choosing Enterprise Resource Planning (ERP) software, while some are relatively smaller decisions like what email template should be used when a customer places an order. These ‘customer value enhancement’ based decisions continue all the way down to navigation on the website and product design. Regardless of the size of the decision, I can’t find a more important clarifying question than, “Does this create customer value?” For a team working together on a new project, it’s amazing how much easier and more quickly decisions can be made when all team members are working from this perspective.
Consider another example how this question can be applied to various processes within your company. For instance when considering, the sales quoting process, a customer-centric consideration will ask questions such as: Where do the delays typically occur? Are there approvals that could be automated by some exception to decrease the response time? Can you program a quoting route that only requires approval over a certain amount or below a certain margin? What percentage of quotes are delayed for approval, and how much costly employee time is wasted tracking these back and forth? Could digital signatures prevent the customer from having to print, scan and send your quotes back? How can waste be eliminated to improve performance?
Again, when making these decisions always circle back to the core question, “Does this create customer value?”
Remove or Restructure Any Practice That Does Not Create Value for Your Customers
There are many things that don’t commonly provide customer value–particularly when you look at your time, your employees’ time, and overall company resources. Examples include analyzing all the data in a report instead of looking only at the exceptions, inventory that is sitting for too long, managers creating reports that could be a real-time dashboard, an inefficient sales process, purchasing delays, or marketing campaigns that waste customer’s time instead of providing value on their own.
A common business mistake is trying to restructure a business process that does not create value for your customers. When considering a process within your company, first take the time to consider if you can simply remove that business process all together. If you can, remove it! If you can’t, then secondly determine how you can change your existing practices and policies to ensure that as much of your time is spent creating and delivering value. Remember, great organizations strive to be as close to 100% as possible. After all it’s a direct correlation, perceived value equals revenue generated.