This elusive word value, which we all seek but do not always find…Is it there, is it discovered, or is it created?
Is it a two edge sword, where on the one hand it is created and on the other side it is diluted?
Or is it a win-win situation? Value is created for both sides (or co-created?)
In my definition, there is latent or potential value. Value which exists but is not noticed.
I am going to give a few examples:
- Where value is shared with the customer and the provider gets little value
Google search, free: Creates great value for us customers, and very little for the company or disproportionately less (at least when it started, and for a number of years after that). Is it win-win? Is this because Google had a long term policy?
Giftivism and pay what you like: Restaurants (Karma Kitchen in Berkeley) or eye clinics (Arvind Eye Hospital) are an example) where you pay what you want, and your payment could fund or pay for others who come after you. The high throughput this causes, lowers cost per patient and payment to doctors per patient, increases value for customers, reduces costs of supplies like medicine, stent etc.
Nipun Mehta in a Ted talk said instead of showing Value we were creating Value. What can we give rather than what can we get. (https://www.youtube.com/watch?v=kpyc84kamhw)
- Where value is created for the customer and the provider and simultaneously destroying value for someone else
Uber: Cars are being used sparingly (they stand idle for most of the day). Uber increases utilisation, and so fewer cars will be needed, a lose situation for car makers, a win situation for consumers who get transportation on demand.
- Where value is not noticed
Look around you. Do you notice value that is staring us in the face and waiting to happen. Examples are
This example has happened. In India, the helpless service people like independent plumbers and electricians who could not own phones can now be in touch with their customers, do more with their lives and be reached by the customer (sharing their time effectively). This was waiting to happen, and did not happen by design but happened as these people acquired cell phones and became connected.
Audhesh Paswan, Associate Dean of Northern Texas University talked about the value creation of Bollywood culture. It exposes India and Indian culture to countries in Asia, Europe, the Middle East and the Americas. People are now learning Bollywood dance.
Had the Indian Foreign Service/Indian Government looked at this as a way of making India known and Indian culture popular, they would have promoted Bollywood into these countries and converted latent value into real value years ago, rather than latent value evolving as a matter of course.
A similar example is the Indian brain drain, which was bemoaned by everyone including the Government, because educated Indians were leaving India. Today, everyone says wow! How smart. We have Indians around the world contributing in so many different spheres, and becoming recognised. Most send money back to India. Others come back and contribute to India. Latent value was not developed and not harnessed. It just happened.
When driverless cars happen, where can you create value? In parking solutions, in making cars available where needed, in refuelling/re-energising options, in downsizing cars, in making single person modules or pods, by redesigning roads. The ideas are endless, the value can be huge. And what do you do with unemployed drivers?
And security systems, to add value for those seeking security or those seeking to penetrate security. From invisibility solutions to overwritten videos, from molecular keys for locks to… (let your imagination run. See what you’d like to see, and ask why it isn’t there)
And when this latent or potential value is noticed, we call it disruptive technology or innovation. Be aware of potential value (learn to become aware, because value exists but it has to be seen, it has to be noticed and appreciated, like beauty). Latent value has to be nurtured, and built into real value by you. It then has to be shared (or co-created with customers).
Disruption is the waking up of people, becoming aware of latent value.
And when this latent or potential value is noticed, we call it disruptive technology or innovation.
You can be a disruptor, too. Look for potential value. Value is everywhere around you. You have to notice it and build the latent value to real value. You can use any of the techniques above.
Would love your comments and help. We are happy to help others in education and executive education on courses in Value Creation.