Value creation selling helps your customers succeed

September 11, 2011 by
value

Ram Charan, author of “Leaders at All Levels”, describes [1] a new approach to sales that revolves around helping customers to succeed. He calls this value creation selling (VCS).  Successes should be measured in terms of how customers benefit from your help.  The ability to create value for customers will differentiate an organisation from its competitors and attract a fair price paid in return from the customer. Value creation selling includes the following practices:
  1. Understanding the customer’s business by devoting time and energy to learn about it in detail:
    • What are their goals?
    • What financial measures do they employ?
    • How do they create market value?
    • What key factors differentiate their product or service from competitors? 

  2. Utilising new capabilities and tools for learning about how customers go about their business and how you could help them improve.  Staff from key departments must also highly familiar with these customers.  Share information about customers with key personnel and collaboratively decide the best ways to help the customer win.  Build new social networks which lead to frequent interaction among people from differing functional backgrounds.
  3. Knowing your customers and the customer’s customers. Tailor solutions to satisfy your customers' markets by discovering:
    • Who their customers are,
    • What they want,
    • What their problems and attitudes are, and
    • How they make decisions.
    • In order to devise unique offerings for your customer work backward from the needs of the end consumer to the needs of your In order to devise unique offerings for your customer work backward from the needs of the end consumer to the needs of your customer.

  4. Value creation selling generally requires longer cycle times to produce an order and to generate revenue. Therefore it requires patience, consistency and the development of high levels of trust with customers. Two-way information exchanges will be far deeper and lead to increased credibility.
  5. Redesign recognition and reward systems to encourage the behaviours needed to make the value creation selling approach more effective.  Members of the sales team in other functional areas must also be recognized and rewarded in proportion to their contribution.

[1] Charan, R., (2010), Profitable Growth, Leadership Excellence, Vol 27, Iss 11, pp 3-5, Executive Excellence Publishing, Provo,

Neil Crawford
BPIR

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