Enterprise Value Creation - EVC™

Assessing, Forecasting and Enabling Economic and Strategic Value

Glomark-Governan Blog

No Shortcut to Communicating Value to Internal or External Customers!


When it comes to communicating the value of a new initiative or solution, many executives (i.e., sales leaders, marketing executives, CIOs, CTOs) believe that a quick way to do it is the right way.

 

Unfortunately, in many cases a fast approach to value communication has negative consequences.  It is a well-known fact that a large percentage of new projects fail to realize and sustain their forecasted value.

 

“Give me something that our sales teams can use to quickly—and with the least possible effort—help our customers understand our value proposition, and justify investing in our solution” –is a common statement that we have heard from sales and marketing managers for many years.

 

The bottom line is that for most business-to-business solutions, rapid ways to communicate value, such as the use of rapid ROI calculators, fail.  Value selling success occurs when the necessary activities to define and communicate value are effectively integrated into our business process(es).

 

Even initiatives that require agility and fast implementation, require an objective value assessment; otherwise a necessary solution may not be approved, or may fail to create value because the right stakeholders—the ones that will enable the value, or manage the users of the solution— were not effectively involved to validate and agree on the benefits, requirements, and metrics.

 

There are number of considerations and best practices that enterprises and managers can adopt for effective value selling.  The following are some of them:

 

Communicating Value Is a Process.

Whether you are selling an initiative or solution internally or externally, don’t just think about your selling process —also consider the buying process and put yourself in the decision maker’s and decision influencers’ shoes, to understand what they will need to make the decision.  Additionally, get involved the individuals that will have to participate in the enablement of the benefits of the solution.  What is it that all of the stakeholders will need to understand, know, and validate the value?  What do they need to be sure that your solution meets their needs, is the best alternative, can be justified, and is not put on hold until a later date?   

 

Communicating Value is neither a quick task, nor function, nor a separate process.  Whether you are trying to sell something as part of your IT, sales, engineering, or operational function—Value Communication is a series of activities that must be integrated into your business process, in order to “identify, define, assess, economically quantify, and effectively validate” the value with the necessary stakeholders, to be sure that your solution is not only sold, but also it becomes an implementation success, and the benefits are sustained throughout the solution’s lifecycle.  

 

Companies Don’t Buy – People Buy.

Value means different things to different people; and if more than one person is going to be involved in the decision to invest in your solution—which is the case for most internal and external selling situations— then we must consider the position and level in the organization for each involved individual, in order to determine the type of value creation that they need to understand, to move forward with your solution or initiative.  Consider that the value perceived, for example, by a technical manager (e.g., IT or engineering manager), is different than the value perceived by a non-technical business manager (e.g., marketing manager, or human resources manager), and different to the value perceived by a financial manager, or by a President and CEO.

 

An Effective Value Management Practice Requires Effective Value Models and Templates

In enterprises, everybody is busy; and not everyone has all the necessary time to effectively define how a solution or initiative can create value for the different types of buyers, constituencies and stakeholders. 

 

A trend and best practice, is creating generic value creation “templates” for either, solutions (by vendors and providers used for external selling), or for use by business areas (for internal staffs, to internally assess and communicate value).  

 

These models or templates must include the common type of benefits that apply to a solution, or to an area, with the necessary formulas, and required data and assumptions needed to determine, forecast and communicate the value to external or internal customers.  

 

Effective value models—which can be used as templates when necessary—require a simple, yet effective structure for the benefits.  If the benefits and their formulas are not objective, then customers (internal or external) will lose confidence in the benefits presented, and will not buy into the value of the proposed solution.

 

Contact Glomark-Governan at  information@governan.com to find out more about how to create effective value templates for your organization; and implement an effective value management practice that is mature, and that can be easily and effectively adopted by your IT, Operations, Sales and/or Marketing teams to ensure that your solutions and initiatives are not only effectively evaluated, but also that your customers realize the expected benefits!

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