Building a convincing Value Proposition

How to proof the true value of IT and technology to an organisation

An IT strategy is best described in terms that are comprehensible to a non-IT audience, free of technical jargon and acronyms, as not every executive can be equally IT-literate. Therefore, it is recommended that the IT strategy concludes with a section that articulates the value proposition (VP) for its customers.

To avoid lengthy discussions on an executive level, it might be useful to zoom in on the VP first before presenting the entire strategy. Ultimately, from a business perspective, the value offered is what it boils down to and executives are less concerned with the more technology-oriented sections of an IT strategy.

A VP is terminology that is borrowed from marketing and expresses the value that a customer, internal and external, can expect from a product or service. Satisfied customers are at the basis of sustainable value creation. The VP describes the benefit in the customer’s terms and language and avoids excessively complex explanations on the often technical nitty-gritty.

Bear in mind that the alleged benefits must be measurable and demonstrable even when these are less tangible, for example, ‘improved customer experience’. 

Xperian’s practical steps to define the IT value proposition:

  1. Differentiate between IT customer segments and identify those groups or departments for whom IT services have the potential of delivering value.
  2. Then, attempt to identify the value that clients obtain from IT’s current service offering by interpreting both positive and negative customer feedback. The effectiveness of a VP highly depends on collecting customer and employee feedback.
  3. Define the service mix that will be capable of leveraging the value experience with each identified target group. In other words, how can we improve our current services to increase value and what service are we currently lacking for this same purpose?
  4. Assess the benefits of IT’s service offering in the context of the value experience IT is able to deliver whilst bearing in mind that the experienced benefits for your customer are offset against cost and associated risks.
  5. Optionally, you can consider alternative options that IT can provide for each of the VPs and compare all options based on the combination of benefit, cost, and risk.
  6. Ensure that you are rather transparent on which stakeholders within your company will profit from these benefits of your VP.

Jan Verbruggen

Partner XPERIAN BV

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