Two Things You Need to Know about Creating Value

March 13, 2012 in Critical Success Factors, Customer Behavior, Demand Generation, Differentiation

By one estimate, three out of ten products fail because of poor value proposition. In other words, 30 percent of products don’t provide consumers with enough value.

Three out of ten might not sound like much, but for the product developers behind those products, it is a crushing defeat. Understanding what “value” means to their target consumers might have saved their products.

Customers measure value based largely on two things: price and benefit.

PRICE is the amount a consumer is asked to spend on a company’s product. A product must live up to its price. To claim value at any price point, a company must make a customer find enough worth in its product.

BENEFIT is the “worth” that the consumer must associate with your product. Your customer must be able to justify paying a product’s asking price, and this justification is determined by the product’s perceived usefulness and benefit.

To create VALUE for your target customers, you must strike a balance between the price of your products and the benefits they will provide. Find this balance and avoid a product failure!

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5 Reasons Why Multitasking May Not Be Good for Business

March 9, 2012 in Critical Success Factors, Processes, Product/Market Fit, Risk

1. Multitasking leads to lessened efficiency. The human brain can really only focus on one thing at a time. Although you may feel that you are getting more done in less time, your brain actually needs more time to switch its focus between tasks.

2. Confusion can cause ineffective results. If your employees are constantly switching their focus between tasks, details will get muddled and confusion will ensue.

3. You are not getting the most out of limited resources. Product development can suffer when resources are incorrectly allocated. Multitasking takes focus away from devoting the proper amount of time to each project.

4. Employees can become burned out. Filling every spare moment with a different task seems like the best project management strategy, but weary employees will become less productive than if they had time for mental breaks earlier in the process.

5. The team is no longer a team. Multitasking often turns into an individual’s game as each employee finds different pockets of time to devote to a product assignment. The “two heads are better than one” strategy for product development will cease to apply.

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Top 3 Reasons to Give All Employees Their Say

February 28, 2012 in Critical Success Factors, Culture, Team Improvement

The future of product development, creativity, and innovation does not lie with a small group of upper management individuals in your company. The future of your business cannot afford to be so limited in scope that it excludes the thoughts and innovative ideas of all other employees.

Many companies are learning to accept more insights from lower-level employees. The Top 3 Reasons these businesses are amassing all employee brainpower are:

1. Allowing for more than just the loudest voice to be heard.
By creating a system for “internal markets” or even games of betting anonymously on product development ideas, all individuals can give input without feeling silly or without being degraded for their opinions.

2. Acquiring knowledge from various areas of expertise.
Upper management can tend to be a small group of similarly minded people. By gathering input from all areas of the company, product development will benefit.

3. Giving employees a sense of belonging within the organization.
While you gain predictions on product pricing or sales figures, your employees are discovering that their input matters. Feeling involved will make your employees want to participate more in the future and will even instill in them company loyalty.

Source: Erick Schonfeld, “The Wisdom of the Corporate Crowd”, Business 2.0, September 2006, Pages 47–49

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