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Chapter2ObjectivesDefinevalueandsatisfactionandunderstandhowtodeliverthem.Describethenatureofhigh-performancebusinesses.Explainhowtoattractandretaincustomers.Understandwaysofimprovingcustomerprofitability.Definetotalqualitymanagement.CustomerValueCustomersestimatewhichofferwilldeliverthemostvalue.Theythenformanexpectationofvalueandactuponit.Customerdeliveredvalue=totalcustomervalueminustotalcustomercost.DeterminantsofCustomerDeliveredValueTotalcustomervalueTotalcustomercostCustomerdeliveredvalueImagevaluePersonnelvalueServicesvalueProductvalueMonetarycostTimecostEnergycostPsychiccostCustomerSatisfactionSatisfaction:feelingsofpleasureordisappointmentresultingfromcomparingaproduct’sperceivedperformanceinrelationtoexpectations.Satisfactionisafunctionofperceivedperformanceandexpectations.Question:whyarecompaniessointentuponsatisfyingthecustomer?KeysLeadingtoHighPerformanceHigh-PerformanceBusiness

Organization(clickformore)

Processes(clickformore)

Resources(clickformore)

Stakeholders(clickformore)Clicktogoforwardtoslide11

ProcessesCompaniesmustincreasefocusonNew-productdevelopmentCustomerattractionandretentionReengineeringworkflowsBuildingcross-functionalteamsresponsibleforeachprocessClicktogobacktoslide6

OrganizationandOrganizationalCultureCompany’sorganizationisitstructures,policies,andcorporateculture,allofwhichneedtobenourishedinrapidlychangingworld.Corporatecultureissharedexperiences,stories,beliefs,andnormsthatcharacterizeanorganization.Clicktogobacktoslide6

ValueChainFirminfrastructureHumanresourcemanagementTechnologydevelopmentProcurementInboundlogisticsOutboundlogisticsMarketingandsalesSer-viceOpera-tionsMarginMarginPrimaryActivitiesSupportActivitiesLeviStrauss’

Value-DeliveryNetworkCompetitionisbetweennetworks,notcompanies.Thewinneristhecompanywiththebetternetwork.DeliverySears(Retail)Levi’s(Apparel)OrderDeliveryOrderCustomerDeliveryDuPont(Fibers)OrderDeliveryOrderMilliken(Fabric)SatisfiedCustomersRemainloyallongerBuymore(newproductsandupgrades)Spreadfavorableword-of-mouthExhibitmorebrandloyalty(lesspricesensitive)OfferfeedbackReducetransactioncostsCustomerDevelopmentSuspectsProspectsInactiveorex-customersDisqualifiedprospectsPartnersAdvocatesClientsRepeatcustomersFirst-timecustomersLevelsofRelationshipMarketingManycustomers/distributorsMediumnumberofcustomers/distributorsFewcustomers/distributorsAccountableProactivePartnershipProactiveAccountableReactiveAccountableReactiveBasicorreactiveHighmarginMediummarginLowmarginEnhancingCustomerBondingandSatisfactionGiveexamplesofthefollowingwaystodevelopstrongercustomerrelations:Let’sDiscussAddingsocialbenefitsAddingfinancialbenefitsAddingstructuraltiesTheProfitTriangleValuecreationCompetitiveadvantageInternaloperationsProfit$$$$$$$$#1QualityQuality:allfeaturesandcharacteristicsofpro

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