When a company decides to take on the challenge of working their way through the ‘value building process’, one of the exercises we take the leadership teams through is an analysis of what drives value in their business. There are about 90 areas of value segmented into 14 different dimensions such as “Markets”, “Product or Service Leadership”, “Pricing” and “Financial Performance”.
Business leaders often ask if a company has to excel in all fourteen dimensions to build a premium value.
You’ve got to meet industry standards in each category and you have to excel in the dimensions where your company has special expertise. Marcus Buckingham, who developed a “strengths management” approach to building efficiency, offers the analogy of responding to a report card your child brought home with three As, one B, one C, and one D.
Which subject gets your immediate attention?
If you’re like most parents, it’s the one with the D. Buckingham suggests that you focus on your child’s strengths instead. Your son may be a prodigy in the subjects in which he received As. Get some help to pull up the lower grade, but don’t waste all your time getting that D to a B or an A while risking the As.
Similarly, it is important to keep some perspective as you achieve an honest assessment of your organization. Eventually, you’ll hone in on your company’s strengths and bring your D grades up enough to stay out of hot water.