Leveraging The Power of Value Discipline Thinking
From the list of, “Books that I truly wish had updated editions” comes one of my top 10 favorites, the 1997 book, “The Discipline of Market Leaders,” by Michael Treacy and Fred Wiersma.
I re-read this book…or at least parts of it every year and I still carry through the concepts in my academic and client strategy work. While the examples are brutally dated and some of the companies have moved from good to great to gone, I find the framework of Value Discipline thinking to be a powerful tool that is easy for students and clients to digest and one that is useful in guiding strategic choices.
If you’re not familiar with the framework or the book, or it it’s been a decade since you’ve picked it up, I encourage you to add it to your reading list. You will come away with some good insights and I suspect some very challenging questions about how your activities, investments and resources are properly aligned around your firm’s true value discipline.
The Basics:
Treacy and Wiersma submit that no firm can be all things to all people and that a firm’s managers must clarify the value proposition (in my terms, why people buy), select a value discipline from one of three major choices and then build the right value-driven operating model to support that discipline. The three value disciplines that Treacy and Wiersma outline are:
- Operational Excellence-where firms focus on price and convenience.
- Product Leadership-where the emphasis is on creating products that consistently push performance boundaries.
- Customer Intimacy-where firms cultivate deep relationships with their clients.
The authors also appropriately highlight that the choice of a discipline is not a goal or a program or a campaign, but rather “a central act that shapes every subsequent plan and decision a company makes…”
The Power of the Value Discipline Framework in Promoting the Right Discussions:
- It’s always fascinating to watch a group of executives flail over what their value discipline is or is not. Rarely does a team immediately agree on their true value discipline. Some of the debates are nearly comical, although out of regard for clients, I will refrain from highlighting the narratives. Let’s just say that they often align very closely to the particular functional role of the executive.
- The discussion around Value Discipline forces a critical discussion about “value proposition.” Once again, many firms don’t truly understand why clients buy and what their core value proposition is for their customers. They are most definitely not Tuned In (another of my favorite strategy and marketing books in my took kit.) This “gap in corporate consciousness must be closed to improve strategy selection and execution effectiveness.
- Once the debate over “What are we?” distills down to a dull roar and reasonable selection (of which it cannot be all 3!), the framework requires management teams to assess whether their operating model, infrastructure and resource and investments all support the discipline. This is an important part of selecting the right activities and importantly, saying “No!” to the wrong activities.
Value Discipline Thinking is Important for Independent Consultants/Solopreneurs and Small Firms:
While the content is geared towards larger firms and business units, challenging yourself to think through and focus your value proposition and operating approach is critical for your marketing, messaging and business development activities. Run, don’t walk to define a value proposition that resonates with your target audience, differentiates your from competitors and integrates with the services or products that you are providing.
Sidebar: B-School Educators Can Use the Framework as a Tool to Promote Conceptual Thinking
This book and framework offer a great way for B-school educators to create a powerful and practical classroom learning experience. A simple exercise is to ask students to categorize some of their favorite companies into one of the three disciplines and to explain the reasons and evidence behind their choices. It is commonplace for firms like WalMart, McDonald’s and Starbucks to end up in multiple categories.
As part of the discussion, you have a great opportunity to introduce that lofty phrase, “value proposition” into the discussion and make it real for the students as they drill down further into why they actually buy or frequent the various firms.
Last and not least, just as in corporate discussions, the framework provides an easy way for you to delve into the operating models of various firms and to study how activities and investments are aligned to support the Value Discipline.
Great stuff for a rich and practical classroom learning experience!
The Bottom Line for Now
There is no expiration date on “Value Discipline” thinking. While no book and no framework will provide you with the silver bullet for success, spending some time assessing your value proposition, value discipline and supporting operating model is an important exercise for everyone and every firm, from solopreneurs and consultants to global firms.
So, what’s your Value Discipline?
Art Rants: The Insane and Confusing Battle for the Pipe Into Your Home
Filed under: Current Affairs, Customer Service, Marketing, Social Commentary, Social Satire
All across America, legions of streetwalkers (not that kind!) have been dispatched to your home to help you deal with the serious issue of your television service. Or is that your Internet service? Or your phones? Or your wireless phones? Or your toaster?
Before you know it, you’ll be pulling out stacks of old bills from your cable/internet/land-line/cell phone providers and nodding your head as the nice streetwalker from BIGCO highlights how very nicely how dumb it would be to stay with what you have, when you could go with the latest INTERGALACTIC service guaranteed to make all of your problems go away and leave you with just one bill.
You’ll likely not say “yes” to the first streetwalker, but once the seed has been planted, you won’t be able to resist digging into the mystery of whether standardizing on one company might just be one less thing to worry about.
If you’re like me, you’ll pick up the phone and call OTHERBIGCO and give them heck for clearly skunking you these past several years. Your nice Rep will apologize and then proceed to launch into a pitch for her UNIVERSAL-PLEX service. She’ll politely scoff at the claims of BIGCO and point out that her technology is so far superior that there is no comparison.
If the Rep does a good job, as mine did, you’ll find yourself investing more time in planning out your new home cable/tv/hdtv/dvr/cell/landline/voice/toaster integrated system and starting to warm to the idea. You’ll probably want time to think it over and to check and make certain that your toaster has the right interface card.
A few more calls later, you’ve discovered the fine print. One company has a two-year contract, one has a one-year contract and the other has no contract. Installation fees range from a hundred-gazillion dollars…..to almost free. Upgrading to other services…or adding toasters or TVs to the network will require replumbing your house or more than likely, adding a new cell tower in your backyard, but they are all different.
Oh, and don’t forget to ask about what happens after the promotional period ends. I’m not certain, but I think in one case, I have to retire the national debt of a third-world country and pay for the children of my rep to go to college at the end of the six-month promotion period.
You realize after 20 hours of work that you’ve become involved in some form of new, maniacal game brought to you by people that have created rules that don’ benefit anyone but them. It’s your job to figure out the catches and traps and gotcha’s! I’m not certain that you as the consumer can win this game, but you can definitely lose. I think the object is to lose the smallest amount possible for the shortest possible commitment time.
The Bottom-Line:
Hey cable/wireless/internet/cellphone companies, your packages stink, your rules are vague and confusing and your marketing sucks. Oh, and your tactics stink.
Did I mention that the arrogance of suggesting that I pay you to install your new technology in my home so that I can pay you more than I used to for a committed period of time is….well…it’s just plain arrogant.
It’s all about you…and nothing about the customer. We’ve figured out that our lives are now dependent upon you for thousands of dollars per year in fees…and we know that it is your goal to do nothing more than create more ways to suck more out of us, tie us up and leave us confused.
I think I’ll pass and stick with what I have. It’s cheaper and I can tell you to pound salt and turn it all off tomorrow if I decide to go off the grid. Ahh, the feeling of power.
OK, I think I’ll go read a book now. Right after I respond to the tweet from my toaster.
Fresh Voices in Management Excellence: Greg Strouse and His Stories, Advice and Opinions on Working, Managing and Surviving the Corporate World
Filed under: Fresh Voices, Leadership, Life and Business, Management Education, Performance, Professional Growth, Social Commentary, Strategy, Surviving Lousy Leaders, Talent Management, Your Professional Development "To Do" List
Note from Art, in proof that great minds think alike, I woke up, crafted today’s post and then read Greg’s latest only to see that he had referenced me. While this may look like a well-orchestrated mutual admiration campaign, I can assure you that it was purely coincidental. Don’t let his questionable taste in liking my blog detract from his remarkable writing!
Searching through the sea of business and leadership blogs has become a bit like a treasure hunt. I enjoy searching for great voices that have not yet jumped out of the search engines and on to everyone’s screen. Given the umpteen gazillion blogs in the world, it’s not surprising that there are some remarkable voices laboring away in the background.
One of those that deserves to be front and center is Greg Strouse’s Tales from an XOD, Stories, Advice and Opinions on Working, Managing and Surviving the Corporate World.
A little background. Greg uses the term XOD as short for Executive on Demand, which is how he characterizes his professional self. I met Greg on the phone a couple of years ago when he started his blog and was impressed. He’s a great, straight-shooting, creative and super-experienced professional with an easy to read, entertaining and wisdom packed approach to writing.
For some reason I lost track of Greg and his blog for a period of time, and it was my good fortune to reconnect with him recently. I went through a year’s worth of his weekly posts and kicked myself for missing out on these. Frankly, I’m just a bit jealous that he’s a better writer than I am and clearly a lot funnier as well!
I encourage you to take some time to check out Greg’s work at Tales from an XOD and make certain to subscribe. We’ll all be wiser and feel a bit better about the world in the process.
Some of my favorite, recent posts from Greg:
“You’re Kidding Me, Right,” where he engages with an airline representative on the use of his middle name in a scene that could easily have been written into a Seinfeld script and then follows it up with another brilliant example from yet another inept airline.
“Death to Smoochy,” tackles the topic of the current “economic conditions” with another fascinating discussion with his bank and some timely suggestions for businesses that are sleepwalking through this time.
“Logo Your Way to Success,“ where Greg suggests (tongue in cheek) that perhaps the Detroit Lions might reverse their winless ways by changing their logo.
“Don’t Know Everything” and “Hey Do You Still Make that Killer Meatloaf” offer up some great advice for leaders, owners and entrepreneurs.
OK, I could keep going on here, but I will leave the joy of discovery to you. I find it hard to quit reading Greg’s posts, both for the wit and for the great lessons, quotes and examples. I hope that you enjoy his work as much as I do, and don’t forget to take the time to let me…and more importantly, let Greg know what you think.
New Leaders, Twitter and the Volunteer Management Conundrum
Filed under: Career, Leadership, Life and Business, Marketing, Not-For-Profit Leadership, Your Professional Development "To Do" List
A collection of sound bites and developmental suggestions for busy professionals:
The Challenges of New Leaders: Feedback on Practical Lessons In Leadership:
Thanks to Dan McCarthy at Great Leadership for featuring my book with Rich Petro, Practical Lessons in Leadership, on his blog today. Dan features material from the book focusing on: The Top Ten Challenges of the New Leader. Please click over to Dan’s site to remind yourself of these challenges and importantly, check out his consistently outstanding blog content.
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Networking, Collaborating & My Twitter Experience
What started out as a bit of marketing curiosity has turned into a great and productive networking experience for me on Twitter. I continue to meet new and talented professionals on a daily basis and to share ideas and even identify opportunities to collaborate. Share a good idea or thought and watch it spread like wildfire. Have something new to offer in your business, as long as you are genuine and credible, watch the community jump on your idea and spread the news.
I know a number of marketers that I really respect that don’t have a seat at the Twitter Table yet. Fair warning, that this is a potent tool for professional networking, research and brand building. It’s time to pull up a chair and join the discussion.
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Managing Volunteers: A Non Profit Management Conundrum
One of the more rewarding activities that I am involved with, includes working with a great group of professionals to help change the shape of volunteering in our community.
Volunteerism is certainly popular in our culture thanks to the encouragement of our leaders in Washington and in response to the many societal challenges that we face. The fact that more people have time on their hands due to a sudden outbreak of unemployment is a factor as well.
A paradox that I find fascinating is the fact that so many nonprofits truly need the help of volunteers in pursuit of their mission, yet it is fairly common for volunteers to report having had a poor experience. It seems that many non profit organizations struggle to create the processes and infrastructure that allow for effective selection, on-boarding and management of volunteers.
In a Fast Company article titled: Why Volunteers Don’t Come Back, the author highlights research suggesting that as many as one-third of the volunteers from a prior year don’t return—a loss of labor worth an equivalent of $40 billion. The biggest competitor to volunteering? According to the author, studies indicate that watching television is the number one alternative use of time.
At a high level, it seems like there are two issues. As part of our local community efforts, we need to help our community nonprofits develop efficient and effective systems for managing the volunteer process and improving the overall experience and outcome for all parties. This is an eminently solvable management task!
The second issue is a fundamental reality check on how we prioritize our time. The advent of low cost DVRs makes it pretty hard to explain why people need to sit at home at night glued to the tv screen. It’s time to get out into the community and help solve some problems.
The Bottom-Line for Now:
I’ve offered three suggestions here for you to help make a difference. No charge!
1. Pay attention to the developmental needs of new leaders
2. Get started on Twitter and figure out what it can mean to you and your organization
3. Become part of the solution in your community and volunteer.
In particular on the last point, let’s put our heads together and help our non profits do a better job managing their talented and enthusiastic volunteer resources, before they lose them to the latest episode of Lost.
Hey Tech Marketers, How About Helping Your Customers Solve Problems
Filed under: Customer Service, Marketing, Organizational Transformation, Product Management, Sales
“Nobody Cares About Your Products (Except You),” is one of the core rules that author and marketing thought-leader David Meerman Scott espouses in his latest book, World Wide Rave, and throughout his other works and blogs.
The most zealous anti-smokers that I know are former smokers. The fact that in hindsight, I can see that I was guilty of being a bit too proud of the features and functions of my own products as a technology marketer makes me just a bit maniacal about David’s product rule as a user and consumer of tech products today. Unfortunately, it seems like there are still quite a few technology marketers out there that did not get the memo.
My Mini-Technology Odyssey:
For the past few weeks, I’ve been in search of a solution that will allow me to better serve my customers and grow my business. My opportunity is to extend my service offerings by providing e-learning services/courses to subscribers to specific audiences. Based on the feedback that I’ve received in teaching or supplementing my MBA programs with on-line offerings and given the time and cost challenges that so many professionals are facing, I’m convinced that it is time to expand into subscription-based e-learning.
What I thought would be a simple search has turned into a quest worthy of Homer. While it is quite possible that I’m seeking fulfillment for a problem that has not yet been solved—a service that will allow independents and small firms to offer e-learning via a hosted platform with e-commerce and participant management functions, I don’t think this is the issue. There are plenty of firms that purport to offer all, most of or parts of this solution. I think.
Here are the Marketing Lessons I’ve Discovered Thus Far:
-Value-chain and systems thinking are foreign topics. There are a myriad of pieces and parts providers that might sell more pieces and parts if they were able to connect people like me with other providers and partners in the value chain.
Instead of focusing on where their offering fits, these firms view the world through the eyes of their products, not the needs of their customers. Remember the old saying that no one buys a drill, they are buying the hole? It’s true.
In one memorable discussion with a rep for a flash authoring tool, he seemed taken aback that I might ask about platforms or other service providers where I could use the output of his company’s offerings. A review of their web site left you thinking that this very substantial organization viewed themselves as the center of the e-learning universe, yet in reality they are just one component provider. Marketing myopia, anyone?
-Feature lists do not equal answers to business problems. Most of the service providers that sound like they might just solve my problem forced me to wade through long lists of discrete, acronym filled feature lists and jargon, only to leave me wondering whether they truly have what I need. What do you do? Who do you serve? How are your offerings solving problems? None of those questions are tackled head-on.
-Once you get a live human on the phone, you want to throw him/her back. Not once have I encountered a rep on the phone that is capable of indicating whether their offerings meet my needs. They either are clueless or they are so obviously incented to sell what they have, that they engage in something that reeks of used car sales tactics.
-Speaking of used car sales: What will it take for you to drive this product home today? I love the vendors that require you to walk on hot coals to gain access to pricing. Most often, they require a demo before sharing pricing with you. Sorry, but life is too short. I don’t care about YOUR SELLING PROCESS! I want a solution to my business challenge.
Tough Love for Marketers:
1. Revisit your website and ask your customers and targeted buyers to tell you whether your messaging and presentation are helping them understand how you might solve their problems. Build content to match your buyers and ensure that it speaks to solutions, not features.
2. Develop a systems-thinking mentality if you are selling pieces and parts. More than likely, no one needs your piece and part in isolation. The better you can relate and link your offerings to other good offerings in the value-chain, the more your prospective buyers will be comfortable in purchasing your offerings.
3. Stop with the offensive, insulting and invasive selling tactics and pricing shell games! You are just pissing us off.
4. Educate your reps. Teach them how to ask questions and help clients solve problems.
The Bottom-line for Now:
Enough with the myopic thinking and feature-focused, jargon-filled gobbledygook that passes for marketing messaging. Help someone solve a problem and you will sell more. Guaranteed.
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