At our customer experience consultancy, we talk a lot about creating value. A customer’s perception of value drives customer loyalty and retention. And those things in turn create long-term value for a business.
But companies don’t just create value by accident. Those who do it best embrace a strategy that puts value into the very fabric of corporate culture.
Gautam Mahajan has now written an excellent book on this topic, called Value Creation: The Definitive Guide for Business Leaders. Mahajan argues that an executive’s role is to create value, rather than just to be a good administrator or an efficient manager. Many executives are so comfortable in fulfilling their functional roles that they forget that creating Value will take them ahead, enhance their business objectives and profits, and make their customers happier.
Mahajan’s book offers a blueprint for CEOs to establish a value creation culture. The insights he provides can create a positive impact on your life whether you’re a C-suite executive, a volunteer, a public sector worker, a parent or a student.
What Is Value Creation at the Customer Level?
Let’s back up a bit and talk about what it means to create value for customers. Value is defined by the perceptions of those who receive the value. Perceptions will depend on a variety of factors including expectations, emotions, state of mind and willingness to accept the value.
For example, suppose you approach me offering a great deal on a moped. I’m not in the market for a moped right now, so I am not willing to accept the value you are offering. And if you contact me when I’m busy, you might even destroy value for me. When I do want a moped, I’ll remember our negative interaction and shop somewhere else.
On the other hand, if I’m looking for a car, a call from you with helpful explanations might add value by making my search easier. Now I’m more likely to buy my car from you.
Value can also be neutral, as when you stop at the supermarket for a loaf of prepackaged bread. But when you buy that same bread at a bakery, the aroma of fresh baked goods can add value or enhance your experience. And if you bring the bread home and your kids love it, more value is created.
At our consultancy, Beyond Philosophy, we have consistently found that customers’ emotional experience is the biggest driver of long-term value. One of the ways we help clients create this value is through our Emotional Signature that shows the company’s level of emotional engagement with customers.
A Value Culture Boosts Profits and Customer Satisfaction
In his book, Mahajan explains that in our world of increasing disruption, diminishing returns, and demanding customers, business leaders need to create more value to remain relevant and stay ahead of competition.
Rather than just creating value piecemeal or for one segment, CEOs have to evolve a ‘Value Creation’ culture for their companies so as to properly balance the interests of customers, employees, investors, and the marketplace. By shifting the focus to creating value for the entire business ecosystem, good CEOs will become great ones with increased longevity. Companies will enjoy higher profits.
Mahajan’s groundbreaking book shows how and why any company will benefit from a Value Creation Culture. Furthermore, it offers invaluable guidance for creating, measuring and sharing value.
Please share your thoughts on value in the comments box below.
Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.
Follow Colin Shaw on Twitter @ColinShaw_CX
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