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Brief videos viewable in 6 subsections of Concepts/Overview

In these brief Video Summaries, DPV Group founder Michael Lanning introduces some of the key DPV concepts.

Got a Value-Delivery Culture?

In this second major section of Analyze Your Business, you can assess to what extent, for the business you are reviewing, your organization already essentially applies the concepts and methodology of DPV.

Of course, if not yet exposed literally to DPV (or its numerous imitators and borrowers), your organization may not use the exact terminology of DPV, but the question is does the organization really use these same principles? (In this subsection of the Assessment of Your Business, the first few times a specific DPV term is used, it is linked back to another page of this web site for its definition.)

There are three key aspects to a value-delivery-driven culture, by which this Assessment is structured:

  • Got Market Insights? – A value-delivery-driven organization continuously explores the market for strategic insights. It first analyzes its Value Delivery Chain to identify and focus on the real primary entity in that chain (as opposed to focusing on intermediary customers/buyers). The organization then uses the Becoming the Customer methodology to analyze current and potential customers, especially the primary entities, and then analyzes competitors through the value-delivery lens.
  • Got a real and complete strategy? – Such an organization must next translate these insights into explicit value delivery strategy. While many assume they “have” a good Value Proposition, however, most organizations have not articulated a real and complete one, as defined in DPV, nor a complete, integrated Value Delivery System driven by that proposition. And likewise, many have a ‘strategy’ but omit other crucial elements in a complete strategy.
  • And, is it a winning, breakthrough strategy? – Finally, an organization may even have a real and complete strategy, but still must step back and ask if that strategy is clearly a winner, capable of achieving a true breakthrough in profitable growth. Essential to meeting this standard is to have chosen, and committed to delivering, a Value Proposition to the primary entity that will be truly different and clearly superior versus competition, in terms that are meaningful and important to that primary entity.

Got Market Insights?

Here you can assess the extent to which, in the business you are analyzing, your organization uses the essential principles of the DPV methodology for discovering and analyzing market insights, including the study and understanding of current and potential customers and other relevant entities in your chain, and including the study of current and potential competitors.

Question #1: Analysis of whole Value Delivery Chain?

See Value Delivery Chain.
(If your business has a relatively simple chain, where the immediate customer, to whom you sell your product/service, is also the final end-user of that product/service, then skip to Value-Delivery Culture? Question #3.)

In the DPV approach to gathering market insights, the organization continuously analyzes the whole Value Delivery Chain relevant to the business, in search of strategic insights. The entities analyzed include current and potential customers – immediate customers, their customers and so on, down to the last relevant level in the chain. They also include current/potential important suppliers, and various ‘off-line entities’ – those entities who do not actually buy or sell our product/service, but indirectly influence behavior and attitudes in our chain.

To what extent does this description accurately fit the business you are reviewing?

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Question #2: Focus on end-users/’primary entities?’

See Primary Entities.
The business makes a determination of where the ‘primary entities’ are – the entities, in the chain, most important to the success of the business. These primary entities are often the end-users of the product/service offered by the business, or may be close to them. They often are not the immediate customer in the chain, who may directly buy the business’ product/service. (This determination – who is the real ‘primary entity?’ – is periodically revisited as the organization learns more about the relevant chain.) Rather than mostly focusing on immediate customers, the organization deeply studies these primary entities, looking for insights into possible breakthrough-growth Value Propositions to them.

To what extent does this description accurately fit the business you are reviewing?

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Question #3: Within end-user/primary entities, where (on whom) do we focus?

(If primary entities for this business are consumers, then skip Value-Delivery Culture? Question #3 and go to Value-Delivery Culture? Question #4.)

When interacting with primary entities/end-users which are organizations (i.e., not consumers), the organization does not stop at the purchasing function nor even at the buying-influencers, if these do not include the actual users of our product/service within this entity. We do interact with the buying functions, but our greater focus is on understanding, influencing, and ultimately delivering clearly superior value to the real users within the entity.

To what extent does this description accurately fit the business you are reviewing?

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Question #4: How we study and analyze entities – Becoming the Customer?

See Creatively Explore the Market.

When studying entities in the chain, especially the end-users/primary entities, whether these are businesses or consumers, the organization systematically becomes these customers. We explore and analyze what these entities are trying to do, what they actually do, why they do it, and with what consequences; quantitatively wherever possible and relevant. This is called observing and documenting ‘Video One’ in the DPV methodology. The organization thus identifies and analyzes what seems to be important, and all that appears to be suboptimal, including any opportunities missed by these customer-entities, in their Video One.

To what extent does this description accurately fit the business you are reviewing?

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Question #5: How we study entities – Video Two and Resulting Experiences

See Creatively Explore the Market.

Based on the above analyses, the organization creates a set of improved scenarios, ‘Video Two’s’ in some selected future timeframe. Video Two’s are designed to include very significant end-result improvements for these entities, without over-stretching what might be possible for the organization to deliver, even profitably, in the chosen timeframe. The organization thus identifies potentially valuable and economically feasible ‘resulting experiences.’ The organization has not focused on new ways to sell its product/service, nor asked customers to specify what they want. Rather, it has analyzed customers’ current experiences, and creatively inferred a potentially more valuable scenario. (This also contrasts to the common inability to think much beyond our product features and attributes.)

To what extent does this description accurately fit the business you are reviewing?

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Question #6: Identifying value, costs and feasibility of new Resulting Experiences

The organization strives to understand, as much as possible within time constraints, the potential economic value, to the customer entities, of each new resulting experience. Getting this right may entail quantitative market research and/or in-market testing. The organization also works to model and assess the likely cost and feasibility of actually delivering each of these experiences (bearing in mind that many important aspects of delivering these experiences can, in many cases, be performed by the whole chain, not by our organization alone).

To what extent does this description accurately fit the business you are reviewing?

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Question #7: Value-delivery-driven competitive analysis?

The organization analyzes competitors by first defining experiences that customers would potentially value, then estimating how well competition does/could deliver these. ‘Competitors’ include players making similar products/services to ours, but also potential players, inside the industry and out, assuming both conventional and outside-the-box technologies and tactics – whatever could most effectively deliver experiences identified above. This value-delivery-driven competitive analysis contrasts to more conventional approaches which start with competitors, asking what they do vs. what we do, without the right context – what customers would most value.

To what extent does this description accurately fit the business you are reviewing?

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Got a Real & Complete Value-Delivery Strategy?

Here, you are asked to consider the extent to which your organization, for the business you are reviewing, has a real and complete strategy, as defined by the DPV approach.

Question #8: Situation Analysis?

An important foundation for a complete strategy is a Situation Analysis, continuously updated to summarize the state of the business. Key elements include: definition of the relevant market space for this business; its total market size and trends; our business’ revenue, market share, profit, and key recent trends for these basic indicators; description of the most important Value Delivery Chains in the relevant market; key facts about customers and relevant others in the chain, including relevant segmentation and pertinent behaviors (habits and practices) and attitudes; key facts about important and potential competitors; review of important trends and discontinuities, in, e.g., technology, customer/chain structures, competitive activity, regulatory environment, etc..

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #9: Clear financial and other objectives stated in this business’ strategy?

A value delivery business strategy states what the organization intends to do, in order to achieve its specific goals. These goals are key criteria against which the balance of the strategy can be understood, evaluated, and measured. These goals usually should include target revenue, market share, and profit, over some appropriate short and a longer term. (Strategic goals may also include more indirect objectives, such as indirectly supporting other businesses, or establishing a beach head in a market, with intent to expand into other related businesses later, etc.)

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #10: Value Delivery Chain analyzed, with primary entities identified?

See Value Delivery Chain

A complete strategy should describe the Value Delivery Chain(s) relevant, indicating where the primary entities are in the chain, and which other entities are important supporting entities. If not automatically self-evident, the rationale for the selection of primary entities should be provided.

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #11: A real and complete primary Value Proposition articulated?

See Choose Real Value Propositions.

At the heart of a business strategy should be a real and complete Value Proposition to the primary entity, followed by the Value Delivery System describing how this proposition is to be successfully delivered. Looking at the strategy and business-plan documents for the business you are reviewing, look at the section that purports to be a Value Proposition, or that section that seems to come closest to being a statement of the Value Proposition to the end-user/primary entity. Then consider whether the following questions are answered explicitly and as unambiguously as possible in that document. (Remember this section of the Assessment does not just ask if there is a statement claiming to be a “Value Proposition” or marketing strategy or mission, or whatever. The question here is whether the business strategy you are reviewing actually answers the following specific questions, for the primary entity.)

Question #11-I: Who is the intended customer? (Who will derive the resulting experiences chosen in this Value Proposition?)

To what extent is this question clearly, explicitly answered in your Value Proposition?

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Question #11-II: What is the specific timeframe for delivering this proposition? (When, for how long, will we deliver it?)

To what extent is this question clearly, explicitly answered in your Value Proposition?

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Question #11-III: What does our business want this customer to do?

What do we propose to the customer that they do? What purchase and/or usage of products/services, and any other behaviors, do we want them to perform? This answer should NOT describe the resulting experiences the customer will derive – see Question #11-V; the answer here should just state what we want them to buy/use/do.

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Question #11-IV: What are the best competing alternative(s) this customer will likely have available?

If they do not do as we wish, what will they most likely do? What competitor to our business would they select, and/or what competing option would they pursue?

To what extent is this question clearly, explicitly answered in your Value Proposition?

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Question #11-V: What resulting experiences will this customer-entity derive, compared to their best alternatives, IF they do as we propose? Includes price and any tradeoffs (i.e. inferior experiences).

See Resulting Experiences.

  • Remember that each resulting experience:
    Is an event or events in the customer’s life/business, resulting from doing what we want them to do, with some end-result consequence of some value for them, in comparison to their alternatives, expressed in measurable, specific terms.
    Is not a description of us, characteristics or features/attributes of our products, services, processes, resources, or functions
    Nor is it a vague ambiguous topic or platitude

To what extent is this question clearly, explicitly answered in your Value Proposition?

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Question #12: Real, complete Primary Value Delivery System articulated?

See Take Action: Value Delivery System.

A real and complete strategy goes on to describe in detail each important action, resource, and process needed to deliver the primary Value Proposition discussed above. This element of strategy is the Value Delivery System (VDS).

Question #12-A: Providing each resulting experience?

See Providing the Value Proposition.

For each resulting experience in the primary Value Proposition, the VDS first describes what must be done, by whom, in order to Provide that experience to the primary entity. The product/service is usually central to Providing many of the resulting experiences in a Value Proposition. Thus, here (not in the Value Proposition itself) is where the key features and performance attributes of the business’ product/service should be discussed, as relevant to Providing each experience. If the product/service does not yet exist or needs revision to help Provide the Value Proposition, then it may be appropriate to describe how R&D and other resources will develop or enhance the product/service. Other functions and resources may also be crucial to Providing some resulting experiences. Manufacturing, Supply Chain, Service, and Sales are typical examples. Some activities may be required by entities outside the immediate organization that owns this business. Other parts of our company, or other entities in the chain may need to play a role in Providing some resulting experiences.

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #12-B: – Communicating each resulting experience?

See Communicating the Value Proposition.

For each resulting experience in the primary Value Proposition, the VDS also describes what must be done, by whom, in order to Communicate that experience to the primary entity. To Communicate the resulting experience is to ensure that the customer understands what the promised resulting experience will be, what its value is relative to alternatives, and why the customer should believe that our business can in fact Provide it. Sales, Advertising, PR, Packaging, and various other functions may be centrally involved. Simply listing these functions, however, falls short of specifying how they will actually Communicate each resulting experience. Again, some activities may be required by entities outside the immediate organization that owns this business. Other parts of our company, or other entities in the chain may need to play a role in Communicating some resulting experiences.

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #13: Supporting Value Propositions and VDS’s articulated?

See Value Delivery Chain.

For key supporting entities in the Value Delivery Chain relevant to the business you are reviewing, the complete strategy should articulate the supporting Value Propositions and VDSs, following the same structure as discussed above for the primary entity

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #14: Key capability gaps, and how these will be closed, identified?

The complete value delivery strategy needs to identify key capabilities that the organization will need to build or bolster, in order to deliver the Value Propositions chosen above. It must also indicate how these gaps will be closed, with what initiatives, at what cost.

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #15: Key needed resources identified?

The complete strategy must identify the financial and human resource needs to implement it, and should also identify any key leadership requirements to ensure success.

To what extent is the above-described element documented, in support of your business’ strategy?

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Question #16: Key risks identified?

Finally, most strategies, and any breakthrough-growth strategy, will entail some risks, including financial, competitive, and sometimes channel-conflict. In addition, there is often risk of executional failure, where key capability gaps may not be adequately closed. The strategy must address the nature of these risks and how the organization will manage them.

To what extent is the above-described element documented, in support of your business’ strategy?

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Got a Winning, Breakthrough Strategy?

Finally, in assessing your business today, now that you have looked at whether your organization has articulated a real and complete strategy, you can now step back ask a different question about your strategy: do you believe it will achieve a true breakthrough in profitable growth?

Question #17: Truly superior primary Value Proposition?

If your organization can effectively provide and communicate the primary Value Proposition (VP) in your above-analyzed strategy, to what extent is this VP (or would it be) understood by this primary customer as truly superior to the alternatives?

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Question #18: If the target primary entity for this business fully accepts and buys-in to your VP, to what extent will this have a major, dramatic impact on the attractiveness of this business?

Consider the impact you would expect on: market share; total market usage/consumption levels; and profitability of the business:

Question #18 A: Market Share – How much market share will this strategy win?

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Question #18 B: Total Market Usage/Consumption – how much will this strategy grow the market?

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Question #18 C: Profitability – How much will this strategy improve the business’ profitability?

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Question #19: Net assessment of the strategy for this business.

Indicate the extent to which you agree with the following conclusions about your business’ strategy (note that 1 = Strongly Agree, 5 = Strongly Disagree):

Question #19 A: We don’t really have a strategy to deliver a VP to the real primary entity in this business

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Question #19 B: We are only aiming for small incremental improvements; our organization sees this business as a commodity/mature category, where major improvements aren’t realistic.

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Question #19 C: We’ve already achieved a dominant share, expanded the market dramatically, and print money; we have no room left for major improvement

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