Value Proposition

Business is a bit like going to the Olympics, you have to chose your sport and become world class in it. It's highly unlikely that you are going to be world class in boxing and swimming and high jumping because the body shape and exercise and food requirements are all fundamentally different.

When it comes to running an organisation there are only three "sports". Wierseman says, to be world class (a requirement today), an organisation needs to be world class in one (and only one) of three possible Value Propositions.

The three Value Propositions are:

  1. Operational excellence (e.g. The Warehouse or Mc Donalds) where the customer gets a reliable product or service at competitive prices, delivered with a minimum of difficulty and inconvenience, or

  2. Product leadership (e.g. Nike, Peter Jackson, All Blacks or 3M) where the customers get products which are constantly redefining the state of the art, or

  3. Customer intimate (e.g. Booz Allen Consulting or IBM (in the 1960s)) where the customer gets a total solution, not just a product or service and the organisation knows the customer's business better than the customer knows it. Check out our product that makes your organisation Customer Intimate

Not to choose is to be not strategic. Not choosing means not being one thing or the other. Not choosing means being grey and colourless. This is because world-classness in one Value Proposition means, almost by definition, that it is impossible to be world class in the others. For example the culture you need for Operational Excellence is very different from the culture you need for Product Leadership or Customer Intimacy.

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Key words: strategy, strategies, business strategy, business strategies, strategy management, strategic management, strategy development, implementation.

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