DISCOVER YOUR VALUE DISCIPLINE

Use this model to bring focus on your strengths, where to compete and how to win.

The Tool

A The Value Discipline tool is adapted from Michael Treacy and Fred Wiersema’s widely used framework Value Disciplines (discussed in their book The Discipline of Market Leaders).

The insight behind the tools is that successful companies succeed by excelling in one of three value disciplines:

1. Operational Excellence

These companies offer reliable products or services at competitive prices, delivered with minimal difficulty or inconvenience. They lead on price and delivery.

2. Product Leadership

These companies offer leading-edge products or services that enhance the customer’s use or application of the product – making rivals obsolete.

3. Customer Intimacy

These companies carefully target key markets and tailor their offerings to match the evolving demands of the customer. They lead on the human experience they offer their customers.

By leading in one of these areas (while remaining competitive in the others), companies can gain a real advantage over their rivals who offer non-differentiated products and services that have no obvious USP or point of appeal.

One obvious question is: Should a company not try to succeed in all three value disciplines? The truth is that it is very difficult to be all things to all men – the cheapest, the most convenient and the highest quality. The best approach is to focus on your strengths and where you can win.

Why use it?

Focusing on one Value Discipline provides vital insight which can help guide the development of a brand and of service improvements.

The Value Discipline tool will help you to zero-in on where your strengths lie - helping you to prioritise change efforts, get a better understanding of your customers and the ways in which you can grow. It's a valuable tool for strategy developement for 2 key reasons; It's a really flexible tool that can be used at any stage of your company’s growth, and it's a powerful exercise to undertake when you are trying to understanding how you compare to your competitors and how your customers relate and respond to what you are doing.

How to use it

On a scale of 1 to 5 rate how your company performs for operational excellence, product leadership and customer intimacy.

Draw up a chart as shown in the diagram below.

Use your ratings for operational excellence, product leadership and customer intimacy to plot a triangle.

Assess your chart – the longest, most pointed corner of the triangle will indicate the value discipline that your company excels in.

Create charts for your competitors and then review them in relation to your chart.