Enhancing Customer Value: The Principles of Value Addition

Abstract

In today's hyper competitive market, the only constant source of competitive advantage is customer value. Traditionally organization tend to create customer value by focusing on one of the three value disciplines – product leadership, operational excellence and customer intimacy. However, such an approach raises the question like which of these discipline is superior to others? Which of these value disciplines is suitable for an industry or market? There were various approaches to combine the three value disciplines but much of them focused on a limited number of attributes. Also, traditional view considers customer value in isolation and does not factor in the impact of competition. This paper attempts to redefine the customer value by combining the value disciplines and factoring the influence of the competition. The paper also proposes five principles through which organizations can consider adding value to the customer. The five principles are to be applied on all activities and functions of the organization in creating and delivering customer value.