The Cistek Group Newsletter 200602

The Cistek Report

Process Automation Value Seller/Value Proposition Checkup

Your process automation, management, and control systems not only help your customers sell more product at a lower cost of operation, but also provide benefits to the planet by reducing energy consumed, pollution, and conserving raw materials. And yet, some customers buy from your competitor, or worse yet put off the purchase of a process solution in favor of a new ERP system or fleet of new trucks.

Customer-specific value propositions are the strongest tool you can use to ensure that your solutions are budgeted and differentiated from the competition. Marketing and selling value starts with identifying and creating need and continues beyond the close of the sale to documenting results. To begin the new year, conduct a Process Automation Value Selling Checkup by seeing how your organization's practices compare to those of best-in-class. <more>.

Process Automation Value Pricing Checkup
You have differentiated your solution. Investments have been made to make it adaptive, interoperable, advanced, embedded, predictive, intuitive, maintenance friendly, robust, and it really looks cool. There is no better company to implement, maintain and support the solution in your customer’s plant. But are you getting a price commeasurate with the value your customer receives from your solution?

Even though many process automation suppliers have successfully differentiated themselves, few providers are obtaining a price commeasurate with the value the customer receives. Competitor-based pricing, i.e. setting the price in close proximity to the competition still dominates. Lack of understanding of the value received by the customer and the value provided relative to the competition leads to money being left on the table in some instances and the closing off of some market niches in others. The ability to protect price is limited without a quantified understanding of what is important and valued by the customer. To begin the new year, conduct a Process Automation Value Pricing Checkup by seeing how your organization's practices compare to those of best-in-class. <more>

CISTEK Q&A
Question: What does "KPI" mean and how does it apply to value proposition development?
Answer: A KPI (Key Performance Indicator) is a quantifiable metric reflecting the performance of an organization relative to its goals and objectives. In assisting clients with developing value propositions, The Cistek Group looks at both absolute and relative measures of business performance. For example an absolute measure may be "December 2006 Average Report Turnaround Time: 3 days". A relative measure is with respect to a goal, e.g. "December 2006 Average Report Turnaround Time: 87% of goal". It is important for a healthcare IT supplier to understand both. Otherwise a value proposition might be based on improving KPI's that are already meeting or exceeding goals while the real problem areas might be missed.

KPI's are central to Cistek's value proposition development methodology's benefit identification phase. KPI hierarchies are created and the correct level of KPI's are chosen based upon the appropriate customer perspective. Benefits related to the KPI's are described and quantified. If the customer is taking the time to measure something, then it must be important to them. So, KPI's are key to value proposition development.