Defining Business Value: How To Identify and Measure Your Value Proposition | Sam Chin | Skillshare

Defining Business Value: How To Identify and Measure Your Value Proposition

Sam Chin, Process Scientist

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10 Lessons (46m)
    • 1. Welcome and Introduction

      2:40
    • 2. What Is a Value Proposition?

      5:50
    • 3. What Can You Do With a Value Proposition?

      4:22
    • 4. Basic Principles

      6:19
    • 5. Research

      4:53
    • 6. Analysis

      5:21
    • 7. Validation

      4:45
    • 8. Crafting Your Value Statement

      4:22
    • 9. Beyond the Value Statement

      4:36
    • 10. Conclusion

      2:22

About This Class

Understanding the concept of value and knowing how to apply that knowledge in the real world is an essential element for business success. That’s because value creation is what keeps a business running.

This is often literal: if your business isn’t generating money, and you aren’t able to continue funding operations, it will go out of business. Conversely, if you are clear about how your business is creating value, you can optimize your work to increase output and decrease costs of that value creation, leading to higher revenue and profitable growth.

This class will enable you to answer the questions “what value does my business provide?” and “how can I define my business value in a quantifiable way?”. We will begin with a discussion of the meaning of "value" in a business context, and then talk about how this concept can be applied. Too often, we as business owners believe that “if I build it, they will come” but that’s only one piece of the puzzle -- you need to make sure that you’re building something that people want to buy!

In this class we will cover:

  • What people mean by “value” in a business context
  • New ways of thinking about and visualizing value creation in a business
  • How to use data to understand and measure the value your business is creating...and increase it!
  • How to make sure that you are creating value for your customer rather than using guesswork to determine your growth strategy
  • How to identify your business’s “core value proposition” and why that matters

No prior knowledge or experience is required for this class, and we will cover the topic of how to identify your business’s value if you’re just starting out. However, this class will be particularly useful for those who have already started a business and yet are struggling to figure out where to go from here in terms of growth, marketing, sales, etc.

Transcripts

1. Welcome and Introduction: Hi, everyone. Welcome to defining business value. How to identify and measure your value proposition. I'm Sam Shin, and I'm the founder and CEO of Cabbie Consulting. Gabby Consulting is a business process science consulting agency, and we help companies with automation scaling and profitable growth strategies through holistic business process management and me particularly. I've been working with businesses in the for profit and nonprofit sector across a lot of different industries. Legal services, financial services I've done working Natural resource is media digital companies. I mean, really, you name it. So it's one of those things that business process science is universal, and it's the process management techniques that can help all companies in all places. I've been doing this work with clients for about 10 years, and I've done a tremendous amount of work helping companies understand their value, understanding their value proposition and understanding the value creating steps that their processes create. This is a central theme to process science driven process management, and it's something that clients counter intuitively often don't see or they even lose track of over the years, and that could be in small clients that could be in large enterprise level clients. It's really honing in on what part of your processes create value and how do you communicate that? How do you derive that from your actual physical processes? And that's argue what we're gonna talk about in this class today. So that's kind of my background, my experience. I'm also the author of Becoming a Conscious Business, which is the first book written on process science and what it means in terms of managing energy through processes, great business value. So you could definitely check it out if you want to learn a little bit more in my background. But again, today we're gonna focus on defining business value and also is part of our class project that we're gonna do is part of this course we're going to have you doing exercise where with your own business, you can kind of start defining your value proposition, and we're gonna talk about what that means and how you go about doing that. And generally, like a lot of the scale shark courses were doing, this is going to be applicable to all businesses. But I'm going to kind of focus this more to small businesses. Solar preneurs. So you guys out there looking for good resource is in defining and computing kidding value and communicating your processes. This will be driven more towards you. But like most process science I talked about earlier, it can apply to the whole market across any company, any size, any industry. So with that kind of wrap up the introduction and we will jump into the course defining business value. 2. What Is a Value Proposition?: we're gonna start the value proposition conversation by defining value. Because if you don't know what value is, it's gonna be hard to identify what your value proposition is. So value I put up the value equation. Value is benefits minus cost. I'm gonna start this course by setting expectations around this seemingly simple equation when you actually get the math of it can actually be very, very complicated and defining. Everything in here, depending on the process in the context, can also be very complicated. So my friendly warning everyone who's engaging with the course right now is to say, Don't underestimate the complication of calculating value and what value actually means and from whose perspective we're gonna talk about all of these things through the course. But essentially value is just the difference. It's the benefits and access to the cost you spend and engaging with the process. In the process, science language value is defined as the output of any process that sustained over time. So energy goes into processes and creates value for clients. You could say that process the definition of the process Science handbook is, is the mechanism that transforms energy into value. So when you're thinking about what our benefits benefits can be. Anything. This is the subjective component to the value equation and always has to be compared to somebody's perspective or from somebody's perspective. Rather, and a benefit could be looking cool. You know, getting somewhere faster, saving money, spending more money if they're trying to get rid of money. I mean, things that could be one person's benefit could be another persons curse. I mean, it's really you know, one man's junk is another man's treasure. It's completely subject now. I say that at the individual level, but when you're looking at markets and you're looking at businesses, value can be brought up or benefits could be brought up to be really considered fairly stable across different markets if you're looking at populations. But in any case, benefit in the value equation is subjective. It's whatever you were trying to achieve and how much you think it's worth to you and then cost. We usually think about it, at least here in the United States as US dollars. It's the objective comparing factor. It's the cost of energy to do something. It's the cost. You spent it giving your cost in time, it could be your cost in, you know, body energy. But whatever it is in the value equation, we usually to say it's gonna get down to a dollar. Okay, so that's the value vision. Now let's go talk about what the value equation is in a business context. As you can see here, it's exactly the same. So value in the business context is the same thing, and it's kind of it's kind of a joke transition here. But it's good for you to internalize that value always equals benefits minus cost. What's the difference between the personal perspective and the business perspective? Not much. The thing here is the business, that complicated and non intuitive thing. The business If you're looking, if you are pretending you are your business, the businesses benefit is always the opportunity to make a profit. A lot of people find this a little bit confusing, but it's not the revenue. You could be a company that's making millions of dollars in revenue, but you could actually be profit negative, and you could be a dying company. How is that possible? Well, there's a lot of reasons you have to high costs or you're not charging enough. We go on forever about that. But don't confuse the benefit IQ of a company with revenue when it's actually the opportunity to make a profit. So if you're pulling in revenue, it depends on a lot of other factors. Were that revenues actually going to be a benefit to you because of that, revenue could be a curse to you. If every unit of revenue actually cause you to produce negative profits, just keep that in mind. And this is part of why this can get complicated. But the cost, like everything else, is dollars. So a lot of valuation is just about perspective. But in any case, you want your value production to be high, whether you're a person or a business, it's always unity, providing more benefits than it costs to produce it. That's the main point here. And if you're trying to produce it for your market, you have to understand what that value is. And that's why this equation is so important to start the conversation with because what is the benefit and what is their cost? You got a research that that's part of building good value, proposition and That's really what we're talking about. The side where healthy businesses create sick businesses do it seems fairly intuitive, but that's really in the process world. That's the simple truth, which is you could blame your business troubles or struggles on a lot of different things, but it's always gonna come back to do. You have a strong value creation potential. Do you have a strong value proposition? Are all your processes of lying to creating value the healthier value you create, which means you're giving a lot of benefits out at a low cost of the market? You're going to continue to grow if you don't that you're not. So let's talk about what the value proposition is to end the section because we talked about what value is, but we haven't really talked about. What is the value proposition? The proposition with a target of this training is it's this statement. It's the articulation, the communication of it, because the value equation is gonna tell you there could be a number of complicating factors that actually say your company's building value. But what is it and how do you quickly connect with your customers, your investors, your employees It's very important to be able to communicate the aspects of your business process that create value. So the value proposition is that statement. It describes that unique value creation that drives someone to engage with you and not your competitors. So that's really what we want to start with this training with. That's the introduction to what is your value proposition? 3. What Can You Do With a Value Proposition?: Now that we know what a value proposition is, what's the point? What can we do with it? I mean, address that right now in this section, so the first point to make is you could do a lot with it. It's the core of your company. It's It's like the spine or the DNA of all of your business processes. If you're not producing value, you are not going to have a process that last very long. So let's start there. It's very important that you be able to articulate it, define it and then do stuff with it. So now we're gonna talk about the stuff you do with the first category is reducing costs and increasing output well, this may not seem completely overlapping. How does my value proposition help reduce costs, Increase output? While the trick to it is, you need to know what your clients are actually buying because then if there's any other activities in your processes that aren't helping, contribute to that they're called waste. The definition of waste and process management is activity that does not create value. So if you can't clearly articulate your value proposition to yourself or others, then It's going to be very hard to manage your process elements where you're spending time and you're acting and you're spending energy to say Well, is that use force and not useful? If you don't know your value proposition, you don't know what the value to clients actually buying from you. It's going to be very difficult to differentiate that. So if you're talking about managing your processes to reduce costs and increase output, reduced costs of what activities, the non value adding ones and increase output of the value added ones. So just toe kind of tie that together as an example. If you have 10 activities, core process activities in your company and you knew that only three rounding value, you want to bolster those and try as much as you can cut the other seven out. That's how you're going to do this. And that's why the value proposition is very helpful to achieve that. Planning for growth is the second category. This is another thing where for those of you were, think about expanding your business or maybe hiring a few more people or adding a different product or experimenting well, how do you do that everything. Every company that evolves, they evolved from a baseline, the iterated from where they are today, in a Safeway they don't just go from, let's say, being a wolf to being a sheep overnight. You can't fundamentally change the nature of your business or your core competencies or your core strengths. And ultimately, that's to say you don't want to move away from your core value proposition. The client's already buying that from you and giving you money so you can run that process to give them certain value. If you make a new product, if you make a new strategy and you move too far away from your value proposition, you're going to be taking a huge risk. So a lot of companies that are doing success and they're doing very well, they're wondering, where do we go next? What's the next step? Knowing your value proposition is going to help you align business strategy and plan for profitable growth because you definitely want to always playing to eatery over time from where you are now, not just go in random directions and take risks with your business client communications Next category. If I'm trying to sell valued clients. What do you think the easiest way is to do that? Tell them directly what you're selling. That's the easiest way to have that conversation. Don't make them figure out what's valuable about your product. You don't want them to be guessing from. Hey, I'm selling this really cool widget or its green or it's black and you'll love this. That's probably not the value people are looking for, depending on what it is they're looking for. It could be, but that's the whole point. You don't know until you know. And when you do know, tell the clients directly and see if it speaks to them. Speak to middling until they know what value they're buying from you. In that way, they're more likely to have a transparent relationship, and they know what they're getting and why they would engage. And that falls in the last one, which is marketing and sales, which is, if you can actually, through language through interactivity, through how you kind of deal with or communicate with your clients. Let them know what is the value. Why are they engaging with you? What are they buying from you and then kind of rolling that into a strategy around how you would increase revenue and increased clients. The value proposition is the core of your marketing and sales strategy and initiatives. So those are the four main categories. What do I do with my value proposition and why it's so important to build one? So then we'll kind of move on next to talk about more basic principles around value, propositions and value usage. 4. Basic Principles: we just finished talking about what is value. What is the value proposition? How are you going to use it to your benefit? Now we're going to start talking about sections of how to actually derive it, how to work with it. And we're going to start in that sense with basic principles of calculating your value proposition or a value statement that's relevant to your business or whatever business process that you're working with right now. So the first thing here is in establishing value creation. You're gonna use the value equation, but even before that, you need to know what the process is and what your thought is. Your first thought of this process is, Am I actually creating value or not? And process Science processes don't exist for long that do not produce value. Typically, if you have a stable process you consume. There's some value creation going on, and it's for you as sort of the person who's doing this exercise to find what it ISS. But you should know there are some occasions, or especially if they're small processes or minor process. You're reviewing where it's actually over time become always, there's actually no value being created here, either because the market shifting the customers don't want it. Or, you know, the process became so convoluted over time or confusing or complicated, because this this actually happens all the time. In real life examples, there's just very little or almost no value being created in it. So you always have to ask yourself the question first, is this process I'm reviewing or is this business I have creating value and then try to think back to the equation to determine what that you might be in terms of using the equation. Let's think about the lemonade stand example, and I'm gonna kind of talk through this very briefly here. But it's something for you to ponder. All value exchanges happened really between two parties, because if you think about it, even for you as a consumer, you can calculate your own value equation, saying, Oh, this will be a benefit to me. How much is it worth to me? Is the cost of it Less or more than that, and that kind of determines your buying decisions actually determine all of your process decisions. You can really kind of think about that in your general life. But on the other side of the table, if there's money being exchanged or energy being exchanged, there's always another party. So without this could be a 30 minute lecture in itself. So I'm gonna try to go over to the high level. But think about it from the lemonade stand example where I have, let's say, a business professional or an adult and a child, and the child sells lemonade for very, very cheap. Why is this still a viable process? Well, value creation has to be on both sides, just like a company can't sell things at a loss or it would go out of business. A consumer can't buy a bunch of benefits for way more than they cost, or they would stop buying. So if you think about now with two parties in play customer and company so child selling lemonade and adult buying lemonade they both have to be making value using the same equation when you might think, How is that possible? Right. But the reason that's possible is because of subjectivity and benefits. So the lemonade stand example child, for instance, their benefit is the potential to make a profit, and you could think well for five cent lemonade. Let's look at the picture in the slide. How could they possibly make a profit? Well, their cost is extremely low, and you think about maybe what the cost of actual materials lemon sugar, water. But it's really the cost of their time is almost negligible because a child's opportunity costs to just making a lemonade stand when their 45 years old, they're not really worth anything on the market yet so relative to an adult, their time of labor is almost worth $0 which means even at five cents, one could posit that there's value being created for Child because their costs for a batch of lemonade, depending on how many cell is so low. Adult, on the other hand, also wants to go buy lemonade, but maybe his times, with $810,150 an hour, $600 an hour. If he's a lawyer now, if I say I'm has been five cents eliminated, his benefit is cool, Refreshing Lemonade and his Costis five cents. If used to make the lemonade himself that same benefit, let's say it's worth $10 or $15 to him in that moment. That's relative to his earning potential. His time. How much time he could have spent making the lemonade. So even though that five cents is being exchanged, is the same between both parties that the relative differences in their backgrounds, the value of their time, their skills, their tactile, not their tax I'll their tacit knowledge and the regular abilities that's going to make value exchanges between parties possible. So this example is the start of very much could be an academic excursion into how values calculated but generally look at value propositions of your company's building and look at what you can offer to the marketplace at a lower cost, and they could get it themselves somewhere else. What is that element? That's the search for the value proposition. And that's what we're covering here and kind of what is value basics, because you're gonna need to know that at a high level to start understanding when you get deeper into the exercises. So that brings us to an exercise slot where I'm going to encourage you to pause here the training and take some time to think about your own business, your own process What do you producing and how would you start to fit the variables or the way you think about the components of your business into the value equals benefits minus costs? And to do this? The last thing you need to remember is start by using the customer's perspective, and this is gonna play into what we recommended a bit for market research and other things . But the whole point is you are the customer and you are thinking about engaging with your business. What is the benefit you're getting and what is the cost? And it could be multiple benefits that are agreed together and multiple costs at every together. The cost of their actual money, the cost of their time, the ease in which they do business with you have the interface with the company, how simple it is or how automated your processes are. You know the competitive differentiators. Is it easier? Do the same thing with competitors for whatever reason. So it's not a simple exercise, But organize your components from the customer's perspective, first into the value equation, and that's going to start really getting you into the next steps of writing down the value proposition state, and that wraps up basic principles. So next we'll talk about research 5. Research: in creating your value proposition. It's good to know the basic principles, but then when you start actually start doing the world, you need to have a foundation of knowledge. And that's the research part. So in the last section we gave an exercise about writing down some of the components of your business that would fit into value equation. So that's one piece of it. Just to kind of start to get your universe and the language in it that's applicable to value proposition or value thinking started on paper. But it doesn't mean that it's gonna help you figure out if your processes are actually creating value or not, or if what you're producing is actually getting that value out to market. In order to do that, you're gonna have to research a number of things, and the first thing here is your own process. And what I would say to do it is capture your process information. There's another scale share course on our channel. You should check out process storytelling that actually talks about how toe capture structure and visualize process information. But for now, just know that capturing in visualizing process information the right way is gonna give you a very usable process on the process. Map is a process asset that's going to show you the sequence. Who's doing activities where they're being done, how they're being done. And from here, one would posit, or one shouldn't know. I should say that the value creation is embedded in there. You have a workflow or you have a process map that shows what's being done in the physical world. What you're doing with your hands, where you're spending your energy, how you're spending your time and attention during the day if you're working and then the value creation is inherent in that if the customers are buying something from you, you're creating value. So the first thing is captured baseline and start writing it down. The second part of research is talking to your customers. You know, this should seem pretty, I guess, common knowledge now, especially as the business world moves towards more towards customer centric city. But the customers know what they're asking for, and it might not be the value, but they will tell you what they want and the first part of deriving value or applying the value equation to the customer situation is talking to the customers. I guarantee that you're not gonna be able to very easily derive the entire customer outlook without speaking your customers. So reading the reviews, creating surveys, polling them, reaching out, creating more interfaces for interactivity, with your company, calling people up, having conversations, networking about your business or service or product, or like products, get out there and talk to the customers. This is another huge form of research that sometimes can seem like a pain. But it's going to be easiest way to figure out what customers are buying from you from a value perspective. And this next comment is, What if you're just starting out? So a lot of folks who are aspiring to make a business, how does this apply to you if you don't have customers and you have business processes? Well, this is part of your planning. If you're gonna plan a business, you could be ahead of the game by actually just starting to do the exact same steps with your process with your customers, but just simulated some of the process mapping perspective. What should the process be and honestly, outside its value conversation? I definitely encourage you to do this anyway, If you're starting a business, understand your processes and get the map so you can start to get your head around The reality of how complicated business can be. Even if you have a simple idea what you start mapping processes. You figure out that there's a lot going on, but any case map the business you want. Talk to the customers you want and see what they want. You don't have to actually engage as a business with folks to get feedback from them. So same steps kind of a different flavor, but it still applies, especially. You're trying to sniff out value in the marketplace before you start a business. So in this section we have another exercise where it would be encouraged, a pause of training and do some reflection. And this is where you choose a product or service that you offer, and you start capturing the processing customer data on it. So just exactly what we just said for research. Think about what you're selling a particular thing in practice. What is the value in that thing you're selling? For instance, if you're selling pocket watches, I'll tell you a clue. The value is not that you're selling a watch Watch is just the thing. What is it that the thing gives the customer? That's the benefit in excess of their cost? Is it that they have easy access to time? Is it a fashion thing? Is it a status symbol? Is it something they can show off to their friends? Or so people know that having money There's a lot of different aspects of value that are not inherent in the actual product itself. So you need to pick anything that you sell, be it service being product and go out there and map how it's created. So where is the actual value being created in that service or product in your own internal operation, and then go talk to the customers and see what they're actually buying from you? And this is where it's going to take time to reflect. Do you notice any patterns were surprising information here. This is the start of the value point, so once you reflect on that, we can move it in the next part of sort of the life cycle, which is analyzing that research data 6. Analysis: moving into analysis is how we take the research we did on what value we're creating and start to really get to the root of the value proposition, which is one of the activities you need to do to look at your research results and get closer to understanding what your value actually is. The first of the conversation is the process one in process science we call deriving value from process maps being the value chain analysis. When the reason that is is a customer from their perspective will buy a unique value proposition from you. But internally, you're making those value incrementally or in steps, for the most part, for most businesses. What I mean by that is, let's think about boat building for a second. We're not even boat building. Let's talk about something that might be more applicable, like graphic design in graphic design. If you're a freelancer or you're a small business owner, you're not delivering a final graphical product and all the value at one time as you're having conversations with clients consulting them, giving them different design prototypes that they can pick from actually building some drafts that could be closer to a final product that they can, then maybe working to some of their own prototypes internally. On the client side, those are all activities that incrementally add value as your process proceeds from beginning of the service at the end of the service. So the whole point of this conversation is to for you to know when you're looking at the different steps and activities in your business. You're not just creating one value proposition. You might market it, or you might sell it that way. That's why you have articulated in aggregate. But generally the Value chain. There is a small amount of your total value package, even in one pricing that's being created in each subject and stage of a particular service or product production. So when we do the analysis, you're going to look at each step in your process and decide. Is this something the customer would be willing to pay for? So, for instance, if you have to spend an hour per client but keeping, does the client pay for your own bookkeeping to make sure your business stays running? No, they don't. And that's why, from the customer's perspective, this is not a part of the value chain, and you don't want me selling that like, Hey, guys, we have really great bookkeeping here, so we'll make you know easier to do business with us. Nobody cares about that. So it's not something as part of your value proposition. And like that particular step, if you're looking at a product or service from your internal perspective, the business perspective from end to end, try to find out which value from the customer's perspective, go to each step. When you change those all together, you can verify which activities or value added not. And also what is the sum of activities that adds to your total value proposition? And that's the process analysis. Part of the customer feedback part is again what you collect all that customer feedback. This is more on the marketing side of the house, and I was much of the process side of the house, so I'm gonna touch this more lightly. I definitely encourage you to look at more marketing. Specific Resource is if you're interested to understand how master level marketers are taking customer feedback, survey results, trials with clients and actually deriving what they consider the subjective value components from that versus sort of the mawr Hard process level activities in process analysis. But essentially, you're trying to find out what gets them the most. Excited why they're saying that you're using your product over a similar product, why your services superior than any other service that they came across, how they came across your product. What was the easy? What was the interface looked like between you and the client? So this is stuff that what's coming straight out of their mounds is kind of a high level of hint or a high level or very strong indicator of your value is hidden somewhere in their from their understanding. So from looking at the process activities and looking at their feedback, trying to marry together the process value chain with the actual core value proposition that the clients are telling you now you're getting closer to getting a value proposition or value statement that's gonna hold. So what if you're just starting out and again? We have a lot of these throughout our trainings because some of you guys are aspiring business professionals. It's the same thing as in the last section, where if you're simulating the research to do business planning or you're trying to build a business model so that you can maybe you're looking for capital or you're looking to an investor pitch. You want to think through the same thing. If you made up your process or it's an aspirational process. You talk to some customers about something you're thinking about building. Analyze it the same way. Which is what are the value added components your process. How do they marry with things that excite the customers? And how do you seem those together and remove as much waste from the total system as possible? And if you're going to describe those elements in one statement, then you're getting closer to building the value proposition. But it's the very same thing. It's just following through the simulation. So the exercise in this section is carrying on with what we've been doing. Take the process map that you build, take sort of the customer feedback that you're looking at, whether it's reviews or what have you, and then start to think about what is the value chain of your process. What is it that the customers are most excited out and write that stuff down a lot of this is you reveal insight through doing the exercises through, actually documenting. So take your time and do this and then when you're done with, that will be moving on to the next section, which is validating everything you've done. 7. Validation: So we've done our research and we've done our analysis. Now tell about validating with what you come up with sits well with marketplace and the process conversation is actually a simple because in all honestly, if you've actually map your processes, you've gone through each step and you feel like you could rationally justify which steps or adding value, which are not adding value and which ones are maybe not adding value but required. Those were the major steps of how we analyze process steps. The value chain is pretty stable. I mean, if you could basically go through each step into customer, would pay for, those customers would pay for this customer will pay for this. That could be a fairly intuitive process, and as long as you feel comfortable with rationalizing it that way, you have pretty much validated that your process Work makes sense now. I say that knowing that some of you did exercise, you realize that could be quite difficult, depending on your confidence and mapping processes are analyzing different steps and sequences, but generally there's not a lot of validation you need with the client for the process peas . It's really just using your intuition and organizing all your process steps into where there's value creating activities on the client's behalf. So, really, then a lot of the validation step is in the testing your hypothesis about the anecdotal evidence that you're getting from the client's themselves. So they've kind of given you a core value statements or a bunch of poor value material to say this is what they're buying. This is what they're interested in this what they're excited about this, what they're loving about working with you or your product, and it's really from there you can start crafting those into a value proposition statement and getting customer feedback. So again, where does the process come and play there? You need to make sure that in understanding what the customers were saying, it matches what you're actually building. So always think to make that your seeming those two streams together. And this is the tricky part, because again, customers could be saying, We love your watch, but you don't actually know what the value is in the watch unless you look at your process and see how you're building the watch, see where there's a quality, see where there's differentiator and really start to say, If you make a value proposition statement and it matches nothing of your process that you're building or executing, then you've got a problem, whether they come or the customers like that statement or not, because you're not executing it in the current state, so you have to do a lot of bending. So it's kind of like basically saying where your creativity meets your operating reality. So always make sure you're crossing the client stream on the client feedback. In your analysis, the client feedback with not only client but your process stuff. But in terms of testing, your hypothesis is again. What we're talking about is just making sure that you build the summary of all the client feedback and then tested with them. See if residents do they like how you've crafted it. Does it speak to them because you're going to use that for all those different categories You talked about your marketing, your operations, your internal communications, things like that. And again, if you're just starting out well, you're not gonna have passed data. You're not gonna have a lot of records to look at, but you have gone through the exercise just the same. So the theme in the message here is very more sustained. The previous sections, which is validate after you've done some analysis with your test customer group, validate with some operations people who haven't started doing the process yet but to say Is this feasible? Does this make sense? Is this level of quality or this little execution possible? So again it becomes much more theoretical, but it doesn't change the exercise that can be done. So in the exercise here in this section, this is where you get to you from marketing. Sample your split testing your A B testing, whatever you're familiar with calling it. And from a process perspective, it's just basically reviewing this documentation with folks and seeing if it makes sense. So, first for the exercise. Think about your first test. How am I gonna test my value proposition? Statement. How many tests when I'm starting to create here with the market in a way that fits my business? And then when you start getting people coming back to you and saying that they like this statement, it makes sense. It's helping as a message, or it's helping actually align my company, my activities in my market together. How are you going to test that for your industry? How are the results going to help you? So in the exercise here, you're thinking about what is the test? How is that test one who produced an interaction with the marketplace that could give me data that can validate whether my assumptions about my value proposition is correct or not , And then think about how you're gonna collect those results in what they're gonna mean. So there's a lot of components to that. But generally, if you kind of set it up like a basic science experiment and you know that you're trying to test the the effectiveness of your value proposition, that's what the exercise meant to help you with. So after this section, we're gonna talk about actually using that to craft the actual statement, the actual value proposition statement. That's where we're headed next 8. Crafting Your Value Statement: All right. So in testing section or the validation section, we talked about your starting to build your value proposition statements. You're exploring different things. You're exploring different aspects of your value creation. You know, from the process standpoint, customer standpoint. Eventually we'll get time to finalize and craft your value proposition statement. So this first slide here is the value statement formula that we're recommending in this course and obviously, you know, be flexible. You can read other people's opinions. You can match it to your company or industry or context. It's not a hard and fast, but generally you want to have these components to it. Well, you can see here is the pieces you filling in brackets. Your brand slash company slash. Whatever you do offers a product or service. What is it that you're offering? And again, it doesn't matter what you offer. It may not be. Wonder one of the value and you're offering it to who? Who are your customers? What is your sort of the avatar, your perfect customer and what are they looking for? So that's who your marketing towards and then you're doing. You offer that to them to this value or result. And that's the value. That's what you been doing all the research and validation for. You know, if it's the watch brand or if you're a digital marketer or a graphic designer, you know you're going to offer X picture, watch whatever it is. But what's the result? What's the value you've given your expertise, your insight, your guidance? You've helped them achieve a benefit. You've helped them launch their book. You've helped them, you know, when that next client meeting there is something there that what is the value? And that's a little bit again. It's this why this is so important to dig into what the customers using your stuff and then the rest of the value statement formula is compared to. Or here's as unlike. But you offer this to this result, unlike my competitors or my other people who offer similar services because of your differentiator. Unlike this person, we this we do this so it's really showing, and you have to be able to have validated, researchers say. Why customers use you is because you are different in this way and differences among people think back to the lemonade stand example is where value creation opportunities exist. It's impossible to differentiate if everyone is the same. So what makes you different? And why are you different from not only the market and being able to offer what you do and create value their but also from your competitors? So that kind of touches the core pieces of what you've been working towards, and then we kind of talked about it earlier. But once you have that statement, this is where you're gonna go through the four categories we introduced in this course and really start aligning your activities to achieve these results in reducing cost increasing output. Put this all over your service all over your co working space. Your office put it on your slow as your slogan internally so that people know what value they're trying to create, why they're different, what everything they do should be rolling up towards. And that's how you should be bending all your operations towards that so they can avoid compromising what the customers would pay for. They can avoid non value add activities on the growth front, align everything now to this new value proposition statement. Make sure that all the activities strategic or nonstrategic or whatever you're doing. Expanding, scaling, automating and all lines of creating more of the things that your statement talks about. Shout out loud, get it out to your customers. Really? Get in there and make sure that they know it. You've tested. You've researched it, validated the customers. It speaks to them so should appear in all of your marketing. Branding. Get it out there so people know what they're how they're engaging with you. And that really wraps up the marketing sales conversation to put it on the website, put it in your sales materials. If you're talking to clients, put in your proposals. This is where you uses it really is going to be. Once you've really put in the time to build it, it's going to impact every dimension of your operation, every dimension of you doing business. And that's why it's so important to really take the time. And sometimes it takes months of market testing or iterating or doing different things. But it's really going to tell you how to run your business and how the customers are gonna interact with you. And that's really kind of the statement crafting section. So don't expect this being overnight activity and then in the last section for this training will talk about going beyond the value state. 9. Beyond the Value Statement: So now, assuming you've gone through the exercise, we talked about this training. You've got this awesome value proposition state. I want to talk a little bit about how this works. Over time and again. Everything on this channel is informed by a process science in the cabin consulting methodology. So I'm gonna get more process. So it's not as heavy on the marketing side, but this cannot under emphasized how much knowing your value proposition, statement and knowing your value creation is essential for process management and growing our business successfully over time. So in this section will talk about the process improvement cycle, which is the diagram you see here and in your company. Your company company is basically operation. If you're running a small agency or your solar preneurs feeling, it's work you're offering a service. That service that you do day in and day out is your operation and your operation should be producing the majority of the value for clients. So if you think about how your company's gonna evolve over time you have an operation. You're gonna constantly improve that process over time and eventually may lead the larger projects which are for expansions strategic growth, you know, implementing new technology. But that process changes just gonna go straight back into your operations result of the project. And that's why this cross improvement cycle is going to go on overtime now. The point of this conversation is, if you're not clear on your value chain, if you're not clearing your value proposition, this can go horribly astray. And this is a bit of a summary section because we've talked about all the ways that could go wrong. But essentially improving a process towards doing something that's not value creating is your magnifying or improving your ability to create waste. So really, let that settle in your mind space because in terms of managing your processes, if you are not creating value and you can identify which process elements great value, you company is gonna be spending a lot of time doing projects. Improving process is changing, and it may not be for the right thing or what the market wants. So having this high level awareness of how to create value and how to manage it and align it to a value statements always come back to is extremely important again in terms of adding data controls for continuous improvement. So this is a more nuanced dimension of this conversation about having a healthy operating project evolving company cycle. But essentially, nowadays you collect eight on everything. Data quality is a huge concern in a world where you can track millions of data points and you have big data sets and got tons of things you can measure. It really begs the question. What do you measure? How do you measure it? And effective cost? And how do you apply those measures to create a high quality data set to answer the business questions you need to make good business decisions. That's really how that whole conversation goes together. And the answer, if you haven't guessed it already, is chasing and tracking value creation. That's the only thing that keeps your process viable in your business alive. So when you talk about having data controls to support continuous improvement or profitable business growth, you have to put them on the value creating metrics. You could track a 1,000,000 steps in your process, and there's only one value creating step. You're wasting 999,000 whatever it is. Data points to capture nothing so always focus on the value. It's gonna be your data focus also. And then the last point I really have here is when creating a dynamic business model, knowing the value proposition is the spine. Again, it's the DNA of Oliver operating processes. If you want to be dynamic, that doesn't mean you can't change just because you have the same value proposition. In fact, it makes you more adaptable and more scalable. The issue is when you feel like your success is tied to a certain process configuration because you're divorced from the value it creates, you will be very hesitant to change that. This is over time. If you know your value creation and you associate it to certain process steps and not others, you could always change the process. Add new tools, add new systems that's create the same value, but in a different way in a more effective way. And this is another way to look at continuous process improvement and management, which is to say, if you understand value creation, you can create that same value or or value in so many different ways, which is why you can always be adapting and expanding And that's what creates a real dynamic business model being value focused, staying focused on your value proposition state. And those are just some of the benefits at a higher level. So that's not gonna end the problem the presentation of the training today. But I want everyone to know that it goes just beyond having a statement that you refer to. It really can ripple and impacting very positively all aspects of your business, small or large. So thank you for joining the training will conclude shortly. 10. Conclusion: thanks for hanging in there. The class is over, and I'm gonna go ahead and summarize and give Leave you with a few closing thoughts. So this class on value proposition statements creating them, understanding them. We started talking about what is value, and then we moved into what is the value proposition. And then we talked about the various levels of activities from a process and from a customer interaction to mention they're gonna help you in a very reliable and consistent way. Find the value adding elements of your business. We talked about the value chain and we talked from a process perspective. We talked about just getting customer feedback, and that goes through the research phase, the analysis of that research in the validation phase. And then we talked about how the outputs will eventually load into a value proposition statement. We gave you a template with basic elements that you could start to work towards. And then you also know now that it impacts so many different parts of your business not only from a longevity standpoint and continuous improvement strategy standpoint, but your operations, your marketing, your sales, how you communicate with clients these are all things, I could use this value proposition statement. So from here, those are the things you learned in this course. And now we talk about the class project. There was some exercises throughout that were kind of in many bursts getting you through some of the activities or at least thinking about them. The class project is really going to help you drive towards creating that statement entirely. So if you started everything in the exercise, actually start executing that stuff and drive towards providing a statement, leave it in the comments here, ask other people what they think you skill share. If you have any questions for us, we're happy to answer some questions. But ultimately the class projects gonna walk two steps and the different mechanics and summarized what you need to do to get to that statement and then maybe also give you some tips on how you can use it after so just as a reminder, it's been a pleasure teaching this class like all of our classes. Please follow us. Please share this course if he enjoyed it. Please leave reviews on any feedback you have. And other than that thank you so much. for your time here. A cabbie Consulting and me Sam Chin. Personally, I love talking about creating value and how we can evolve business consciousness around these types of topics. So look for more content from us, and thank you so much for your time and attention.