Looking at value in other ways

In ethics, value denotes the degree of importance of a thing or action, with the aim of determining what actions are best to do or what way is best to live, or to describe the significance of different actions

In economics, economic value is a measure of the benefit provided by goods or services to someone else. It is generally measured relative to units of currency, and the interpretation is based on the maximum amount of money a specific actor is willing and able to pay for the goods or services"?

For the last couple of weeks, I have been playing with value in the ethical realm. What are your core values and what do you value? Both hugely important things to be in touch with. Then I switched to what do your team value? We considered the things that might be most important to them and whether you are aware of those as a leader. 

This week, I wanted to look at the economic side of value. Because as we all know, businesses don't just run on ethics. They need $$$ too. And so the question as a leader relates to how you create value as an organisation, as a team, and for those who work for you.

Value is measured in currency. But also in customer loyalty, in brand power and in numerous other ways. I remember when I was going through my MBA the long conversations we had around the concept of customer lifetime value. Then, when whilst working for a bank, the announcements made to close brick and mortar branches in favour of the transition to digital services. It was a tough lesson to realise that whilst it is a nice thing to have a local branch which serves the community, the majority of customers who go to the branch aren't actually high-value customers. They are mostly older people who are getting out for the day to cash their pension checks. Or small businesses banking their takings. Therefore closing the branches had a net positive value effect on the bank without disrupting high-value customers and therefore added economic value to the share price. Much was made of the lack of ethical values in removing this bastion of various Kiwi towns, but that seemed to be less important. 

So perhaps the economic value is the primary value for leaders to consider? I would like to believe that it should be balanced - but in most businesses money comes before people - am I right?

The key to a post COVID value proposition is one which meets a number of criteria. PwC published a helpful model (below) to think of trends leaders need to be considering. The question remains whether organisations double down, pivot, or disappear only to be reinvented in a new guide. 

So if you are a leader considering how you add value in 2021, take a look at this model and let's book an Unlock session. In it, we can discuss where you are at, where you want to be, and make a plan to get you there.

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