Objectives
Objectives
Define value & satisfaction - understand Define value & satisfaction - understand
how to deliver them
how to deliver them
The nature of high-performance The nature of high-performance
businesses
businesses
Determinants of Customer
Delivered Value
Determinants of Customer
Delivered Value
Image value Image value
Personnel value Personnel value
Services value Services value
Product value Product value
Total
Monetary cost Monetary cost
Time cost Time cost
Energy cost Energy cost
Psychic cost Psychic cost
Satisfaction
is a person’s
feelings of pleasure or
disappointment resulting from
comparing a product’s
perceived performance (or
Resources Organization
and
aligning...
High Performance Business
High Performance Business
Processes
By improving critical business...
Stake-holders
©2000 Prentice Hall
The Generic Value Chain
The Generic Value Chain
Primary Activities
S Technology Development
Human resource management Firm infrastructure
Levi Strauss’
Value-Delivery Network
Levi Strauss’
Value-Delivery Network
Competition is between
Competition is between networksnetworks, not companies., not companies. The winner is the company with the better network.
The winner is the company with the better network.
Delivery
Sears
(Retail)Sears
(Retail)
Levi’s
(Apparel)Levi’s
(Apparel)
Du Pont (Fibers)
Satisfied Customers:
Satisfied Customers:
Are loyal longerAre loyal longer
Buy more (new products & upgrades)Buy more (new products & upgrades) Spread favorable word-of-mouthSpread favorable word-of-mouth
Are more brand loyal (less price Are more brand loyal (less price
sensitive)
sensitive)
Offer feedbackOffer feedback
Levels of Relationship
Marketing
Levels of Relationship
Marketing
Many customers/ distributors
Medium number of customers/ distributors
Few
customers/
distributors Partnership Proactive Accountable Proactive Accountable Reactive Accountable Reactive Basic orreactive
High
Inactive or ex-customers
Customer Development
Customer Development
Partners Advocates
Clients
Repeat customers First-time
customers
Suspects
Prospects
Customer/Product
Profitability Analysis
Customer/Product
Profitability Analysis
P1 profitableHighly
product
P2 Profitableproduct
P3 productLosing
P4 Mixed-bagproduct
©2000 Prentice Hall
The Profit Triangle
The Profit Triangle
Valu e cr
eatio n
Competitive advantage In
te rn
al op era
tio ns
Profit
Profit
Profit
Quality
Quality
QualityQuality is the is the
totality of features
totality of features
and characteristics
and characteristics
of a product or
of a product or
service that bear on
service that bear on
its ability to satisfy
its ability to satisfy
stated or implied
stated or implied
needs.
Review
Review
Define value & satisfaction - understand Define value & satisfaction - understand
how to deliver them
how to deliver them
The nature of high-performance The nature of high-performance
businesses
businesses
