In part 1 of the blog series “Unleashing the Business Value of Technology Part 1: Framing the Cha...”, I introduced the 3 stages of “unleashing business value”: 1) Connecting to Value, 2) Envisioning Value and 3) Delivering Value (see Figure 1).
We discussed why technology vendors suck at unleashing the business value of their customers’ technology investments because they approach the challenge with the wrong intent. We then discussed some failed technology vendor engagement approaches; product-centric approaches that force the customer to “make the leap of faith” across the chasm of value.
We also introduced the Value Engineering Framework as a way to “reframe the customer discussion and engagement approach; a co-creation framework that puts customer value realization at the center of the customer engagement” (see Figure 2).
Figure 2: Value Engineering Framework
The Value Engineering Framework is successful not only because it starts the co-creation relationship around understanding and maximizing the sources of customer value creation, but the entire process puts your customer value creation at the center of the relationship.
In Part 2, we are going to provide some techniques that enable technology vendors to connect to “value”, but that is “value” as defined by the customer, not “value” as defined by product or services capabilities. The Value Engineering Framework helps transition the customer engagement discussion away from technology outputs towards meaningful and material customer business outcomes (see Figure 3).
So, how do technology vendors “connect to value” in their conversations with customers’ business executives? They must invest the upfront time to understand where and how value is created by the customer. Here are a couple of tools and techniques that technology vendors can use to understand and connect with the customer’s sources of value creation.
I’m always surprised by how few technology vendors take the time to read their customers’ financial statements to learn what’s important to their customers. Financial reports, press releases, quarterly analyst calls, corporate blogs and analyst websites (like SeekingAlpha.com) are a rich source of information about an organization’s strategic business initiatives – those efforts by your customers to create new sources of business and operational value.
But before we dive into an annual report exercise, let’s establish some important definitions to ensure that we are talking about the same things:
Using these definitions, let’s examine the Starbucks’ 2019 Annual Report to identify their key business objectives (see Figure 4).
Figure 4: Reading the 2019 Starbucks Annual Report
From Figure 4, we can see that one of Starbucks business objectives is “Providing each customer a unique Starbucks experience.” (Note: the annual report is chockfull of great opportunities for technology vendors to co-create value with their customers). Let’s triage Starbuck’s “Unique Starbucks Experience” business objective to understand our technology product and service capabilities can enable their “Providing each customer a unique Starbucks experience”. Welcome to the “Big Data Strategy Document”.
The Big Data Strategy Document decomposes an organization’s business objective into its potential business initiatives, desired business outcomes, critical success factors against which progress and success will be measured, and key tasks or actions. The Big Data Strategy Document provides a design template for contemplating and brainstorming the areas where the technology vendor can connect to the customer’s sources of value creation prior to ever talking to a customer’s business executives. This includes the following:
(Note: the Big Data Strategy Document is covered in Chapter 3 my first book “Big Data: Understanding How Data Powers Big Business.” The book provides worksheets to help organizations to determine where and how big data can derive and drive new sources of business and operational value. Still a damn relevant book!)
See the results of the Starbucks triage exercise in Figure 5.
Figure 5: Starbucks Big Data Strategy Document
To learn more about leveraging the Big Data Strategy Document, check out this oldie but goodie blog “Most Excellent Big Data Strategy Document”.
The challenge most technology vendors face when trying to help their customers unleash the business value of their technology investments, is that vendors don’t intimately understand how their customers create value. Once the technology vendor understands how the customer creates value, then the technology vendor has a frame against which to position their product and service capabilities to co-create new sources of value for both the customer and the technology vendor.