ValueSpaceä
-- Winning the Battle for Market Leadership
Lessons
from the World's Most Admired Companies
Banwari
Mittal, Ph.D.
and
Jagdish
N. Sheth, Ph.D.
June
2001
McGraw-Hill
Table
of Contents
Part I: ValueSpace: A
Mandate for Value Creation
Chapter 1. ValueSpaceä : The Magic Land for Winning Customers
Chapter 2. A Framework for Creating ValueSpace
Part II. Understanding
ValueSpace Strategy
Chapter 3. Customer Focus: The Foundation of ValueSpace
Chapter 4. Performance ValueSpace
Chapter 5. Price ValueSpace
Chapter 6. Personalization ValueSpace
Chapter 7. ValueSpace Expanders
Part III. Three Company
Profiles in ValueSpace
Chapter 8. Caterpillar: Rock-Solid ValueSpace from Yellow Iron
Chapter 9. UPS: The Big Brown’s Package in ValueSpace
Chapter 10. Fossil: Crafting ValueSpace
in Niche Markets
Part IV. A Blueprint for
Action
Chapter 11. ValueSpace Building
Processes
Chapter 12. Customer Value, Value
Discipline, and the Pursuit of Excellence
Chapter 13. A Roadmap for Action
Epilogue: ValueSpace: The Science and
the Art
Notes
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Preface
ValueSpaceä —we hold it in utmost admiration.
ValueSpace—it
is to us the be-all and the end-all of all business activity; the only purpose
of all organizations, all business enterprises. It is the only justifiable goal
of all reengineering, organizational renewal, entrepreneurship and corporate
innovation. And it is the only path for sustained growth; for winning the
battle for market leadership. It is the space where true market value is
created. For shareholders; for employees; and, most of all, for customers. We
present in this book a blueprint on how companies can build enduring ValueSpace
for their customers.
This
book is at the intersection of our two long-held obsessions: As university
professors, we view ourselves as lifelong learners; and for decades, we have
been students of customer behavior on the one hand and business organizations
on the other. We have studied theories of customer behavior—indeed created some
of them ourselves--, and for decades, we have observed, analyzed, and written
about business processes, precepts, and practices. In this book, we bring these
two streams together—our knowledge of customers and our knowledge of
businesses. This is our ValueSpace for you, the reader: Uniquely in the current
sea of business advice books, we combine the customer and business
perspectives. No longer do we need to pay mere lip service to customer
orientation; we show how you can do well by doing good for the customer.
We
set out to understand what constitutes value for the customer and how companies
can create it. Our research method was to study companies that were admired
both on the Main Street and the Wall Street—we chose a sample of 11 Fortune’s
Most Admired Companies. With financial support from the Marketing Science
Institute (a Cambridge-based nonprofit research organization), we crisscrossed
the country, visiting these companies, observing their operations, and
interviewing senior executives. What we learned from these observations and
interviews, and from our reflections, we report in this book.
Our framework, comprising the components
of ValueSpace and its drivers, is quintessential—no matter what else you
do or do not do, you must create these value components. Our framework is
enduring—it is not the "project of the month"; long after the current
fads have vanished, you must still build the value components we describe. Our
framework is universal—it applies to all companies: manufacturing and service;
small business or global enterprises, business-to-business or
business-to-consumer; physical or digital; dot-com or not-com.
We intend this book to be a blueprint for
thought as well as practice. We present conceptual framework to help you plan;
we provide a self-audit form that you can use to assess your company’s current
standing in the ValueSpace; and we present case histories, stories of the most
admired companies, and insights from executive interviews that you would find
both inspirational and actionable. It is a hands-on guide to launching your
journey into the customer ValueSpace.
Our
own journey has been fascinating; we have learned a lot—from the Most Admired
Companies we studied; from the executive interviews we did specifically for
this research; and from thousands of conversations over the years with
consumers, mangers, and corporate leaders just like yourselves. It is a
pleasure and privilege to share with you our view of Customer ValueSpace, and
our total fascination with it.
Ban
Mittal Jag
Sheth
February 2001
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Selected Excerpts:
Value, not money, is the basic currency of
all human interaction. When we meet someone, we try to quickly assess how long would
it be worth our while to be talking to that person. If an incoming phone call
shows up on our called ID, we promptly decide if we would gain anything by
taking the call at that time. If we get 10 letters in the mail, we look through
them and choose to open only those that we expect to contain some information
of value to us. This is even more true for marketplace exchanges....
...
....
Keep your eyes on the value you offer your
customers and constantly keep ahead of your competitors on delivering those
specific customer values, and you will have some assurance that today’s
customers will be with you tomorrow, and the day after. The new miracle
medicine for continued customer patronage is customer value, rather than
customer satisfaction.
....
Companies that invent new values such as
these possess certain traits. They observe customers real close. They dig
customer need to its essential core. And they keep their eyes on a singular
target: creating far fetched new ValueSpace for the customer. These traits
indeed lead a business to mold its own self-concept in the customer’s image.
Rosenbluth redefines the very nature of its business as "business
interaction management." 3M comes to view itself, instead of being a maker
of masking tapes, abrasive papers, and adhesives, as a provider of bonding,
protection, and masking solutions. And, XBS employees never fail to remind
themselves who they are-- customer amazers!
....
This reinvention of oneself as a corporate
being, this customer-centered adoption of a new self-identity, the constant
contemplation of the customer desires —this is what it takes to invent
unparalleled ValueSpace for the customer. This is what it takes to win the
battle for market leadership. This is what it takes to thrive.
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