Monthly Archives: January 2016

What is The Elements of Value

When customers evaluate a product or service, they weigh its perceived value against the asking price. Marketers have generally focused much of their time and energy on managing the price side of that equation, since raising prices can immediately boost profits. But that’s the easy part: Pricing usually consists of managing a relatively small set of numbers, and pricing analytics and tactics are highly evolved.

What consumers truly value, however, can be difficult to pin down and psychologically complicated. How can leadership teams actively manage value or devise ways to deliver more of it, whether functional (saving time, reducing cost) or emotional (reducing anxiety, providing entertainment)? Discrete choice analysis—which simulates demand for different combinations of product features, pricing, and other components—and similar research techniques are powerful and useful tools, but they are designed to test consumer reactions to preconceived concepts of value—the concepts that managers are accustomed to judging. Coming up with new concepts requires anticipating what else people might consider valuable.

The amount and nature of value in a particular product or service always lie in the eye of the beholder, of course. Yet universal building blocks of value do exist, creating opportunities for companies to improve their performance in current markets or break into new ones. A rigorous model of consumer value allows a company to come up with new combinations of value that its products and services could deliver. The right combinations, our analysis shows, pay off in stronger customer loyalty, greater consumer willingness to try a particular brand, and sustained revenue growth.

We have identified 30 “elements of value”—fundamental attributes in their most essential and discrete forms. These elements fall into four categories: functional, emotional, life changing, and social impact. Some elements are more inwardly focused, primarily addressing consumers’ personal needs. For example, the life-changing element motivation is at the core of Fitbit’s exercise-tracking products. Others are outwardly focused, helping customers interact in or navigate the external world. The functional element organizes is central to The Container Store and Intuit’s TurboTax, because both help consumers deal with complexities in their world.

In our research we don’t accept on its face a consumer’s statement that a certain product attribute is important; instead we explore what underlies that statement. For example, when someone says her bank is “convenient,” its value derives from some combination of the functional elements saves time, avoids hassle, simplifies, and reduces effort. And when the owner of a $10,000 Leica talks about the quality of the product and the pictures it takes, an underlying life-changing element is self-actualization, arising from the pride of owning a camera that famous photographers have used for a century.

How to Boost Your Career

Your relationship with your boss is critical to your success. But there’s another person who often has just as much influence over your career: your boss’s boss. What should your relationship with that person look like? How often should you interact with her? What should you say? And how do you foster a connection without undermining your direct manager?

What the Experts Say
“The more you are known and respected by people above you, the better off you are from a career standpoint,” says Priscilla Claman, the president of Career Strategies, a Boston-based consulting firm and a contributor to the HBR Guide to Getting the Right Job. And your boss’s boss — a person who “knows the scoop, knows the vision of the organization, and is helping set the strategy” — is a good person to get to know, she adds. The stronger your relationship, the more insight you’ll have into your company’s future. Moreover, having your boss’s boss on your side gives you professional leverage, says Karen Dillon, coauthor of How Will You Measure Your Life? “Having that person as your champion increases the likelihood that your promotion will be approved, your raise will go through, and you’ll be considered for that next great assignment.” And yet, connecting with your manager’s manager is “a delicate dance,” since your boss is still the “middleman,” she says. Here are some strategies for getting the dance right.

Show enthusiasm
One of the best ways to show your value to higher-ups is to “be present and engaged” in your organization, says Dillon. “If your boss’s boss is giving a lunch talk or a town hall meeting, go to it. Sit in front. Ask questions. Continue the conversation in the hallway.” Show that you care about your company and that you are serious about your career. After all, “your boss’s boss should want to see you succeed. You need to demonstrate your eagerness to do so.” Claman recommends seizing opportunities to touch base and asking information-based questions, such as: ”Do you have a contact that could help me with a particular assignment?” or “Can you recommend a book that could improve my understanding of [a relevant business issue]?” Ask your manager for suggestions first, and then ask if her boss might have more ideas. “People are generally willing to help with these kinds of questions because it allows them to show how knowledgeable they are,” Claman says.

Find a common bond
It’s important to “remember your boss’s boss is a human being,” says Dillon. “Find a way to connect on a human level.” Perhaps she’s a movie fan, an avid skier, or maybe she really enjoys cooking. “It might take digging,” but it’s worthwhile to forge a bond that’s not solely related to work. Also bear in mind the corporate truism that it’s lonely at the top, so your efforts will probably be welcome, adds Dillon. At the very least, “don’t avoid this person.” But also consider “asking her to lunch” or just “engaging her for 30 seconds at the water cooler about her weekend plans, the Oscars, or last night’s baseball game.” At the same time, don’t beat yourself up if you find it difficult to build a friendly rapport. “There are some people in this world that are you are not going to win over,” says Claman. In these cases, you’ll have to court your boss’s boss the way you would a “difficult customer.”

Raise your profile
Just doing good work is “not enough to get noticed” by people higher up the command chain, Dillon says. So “make sure you’re not too heads-down or never claim credit” for your ideas. You don’t want to suck up or brag, but a little horn-tooting may be necessary. Pass on compliments you receive from customers and colleagues to your manager, who will probably send them to his boss, since your success reflects positively on him. Claman suggests you also “take an entrepreneurial approach to your job and the tasks you’re asked to complete.” Pitching solutions that solve your organization’s problems is standard practice for managing up. So offer ideas for new initiatives or “how to do things better and faster.” Some of these suggestions will require approval, and “moving ideas up the hierarchy creates an opportunity to talk to your manager and his manager,” Claman says. Another way to raise your profile with your boss’s boss is by volunteering for a cross-functional committee — preferably one run by him. This both deepens your ties to him and increases your visibility. It’s also worth asking, with your manager’s blessing, if you can attend certain high-level meetings. You’ll increase your exposure to other parts of the company, expand your network, and “develop a personal reputation that’s not tied to your boss.”

Remember who’s
Having a good relationship with your boss’s boss is a wonderful thing — but don’t prioritize it over the one you should be developing with your manager, says Dillon. Keep her in the loop and include her on all communication you have with higher-ups. The adage “Gossip as if people are listening” applies here, she adds. Assume that your boss will hear about any interactions you have with her manager. “Don’t do anything to surprise her, and don’t make it look like you can’t wait for her to get out of the way,” Dillon says. “The worst thing that can happen is that you make your boss feel insecure.” Claman agrees: “Don’t go around your boss. Show your loyalty. No matter what organizations may say about having an open-door policy, there are norms” that you must respect.