The law of perception

It’s easy to fall into the trap that continuous improvement is all it takes to drive growth.

A new software system, a new manager training process, a new product extension. Changes that make big gains toward internal efficiency or effectiveness can heap accolades on its champions.

But will customers notice the change? And, just as important, will they see the change as being worth a change in behavior on their part?

In the process of value creation, the law of perception states that unless a customer perceives the change, it cannot be valued. What cannot be perceived, is not valued.

Take your top initiatives for the upcoming year. Or the next changes in your product line or service offering. Which of these will result in changes your customers perceive? What evidence do you have to support your conclusion?

If you want to drive growth, make sure your customers actually perceive the changes you’re making and believe it’s worth a behavior change themselves.

Practice makes better, not perfect

Practice never makes you perfect.

If it does, you just had your best day and every day thereafter will not be as good.

Everything can be improved, even what you thought was once perfect. And the journey to get to what you currently think is perfect, should teach you a perspective that changes what perfect is.

You want your best day to always be out ahead of you. Always improving. Onward and upward.

So make sure when you say practice makes perfect that you don’t actually mean it. Unless of course, you are cool with each following day being not as good. Or perhaps you really mean it was practice that made it work.

The law of criticism

When it comes to creating value, creators must be highly skilled at getting inside the minds of those they serve.

The more you know what people really think and believe, the more skillfully you can create an offer people will actually use to achieve their goals.

Criticism shuts down genuine empathy and prevents a pure diagnosis. This is the law of criticism.

Avoid words like, no, should, stop, don’t, whatever or won’t.

Avoid phrases or expressions like, that’s dumb, pshhhh, sounds silly, that’s crazy, who would ever do that or so weird.

Master Value Practitioners even are trained to prevent these attitudes from developing within: cynicsm, skepticism, doubt, confusion, condescension, disgust or disbelief.

Remember, when you are diagnosing others you are seeking to understand as they understand, not as you would understand.

The law of behavior

When it comes to creating value, the law of behavior says behavior must change or value is not created.

Whenever my children were in trouble with me, it was common to hear “I know, Dad. I know.” Knowing wasn’t enough to prevent them from behaving poorly.

We all have areas in our life where we know new behavior would benefit us, but we don’t.

“I know I need to get my blood pressure down with exercise.”

“I know it would help employee turnover if I stopped yelling at work.”

If you want to help change behavior, you must also understand what people believe about what they know. Knowing exercise will lower your hypertension doesn’t mean you believe it’s an activity worth doing.

If you want to create value more effectively, start spending more time examining what others believe about what they know.

The law of limited resources

It’s easy to be enamored with your own ideas. Or fall head over heels in love with your new product.

Or your new product extension. Or a new app feature.

But, having limited resources is a fundamental law in value creation. Choosing your offer means customers give up choosing something else. What will your customer need to give up to get your solution? And, what are their attitudes and beliefs about giving it up?

You also might want to know that people are funny about losses. If given a choice between two chances to avoid a loss or secure a gain of the same probability and value, people will generally choose to avoid the loss instead.

Having a great product or service isn’t enough to create value. You need to know whether customers will readily give up what is necessary to get what you offer.

So instead of being so enamored with your own creation, test whether your consumers will give up what is necessary to gain your creation. Until this happens, value isn’t created.

The law of leading

Have you ever observed a person frustrated by a lack of sales? Maybe you’ve heard someone say “the customers just don’t get it.”

These are examples of people ignoring the law of leading in value creation.

In value creation, the law of leading is this…if you want to create value you must accept responsibility for taking the initiative.

So what does this look like in action? Innovators who live by the law of leading don’t get frustrated when customers don’t behave as expected, they take the initiative to adjust. They recognize it is their responsibility to adjust and enable different customer behavior. They get closer to their customer and adjust their offer to be more aligned with the customer’s needs.

And by customers we mean: patients, colleagues, supervisors, teammates, etc.

The law of linking

Creating value means enabling new behavior.

But new behavior won’t occur unless people see the change is linked to a benefit.

Benefits are only things that help people gain on a goal or eliminate a problem in the way of the goal. Basic, but true.

Your offers must be credibly linked to helping customers (…patients, bosses, co-workers, etc.) gain on a goal or solve a problem in the way of this goal, else it will not enable new behavior. This is the law of linking.

If you want to improve your effectiveness at creating value, improve the link to helping your audience gain on an important goal or remove a problem in its way.

When the task is more important than empathy

Following a script or checklist is helpful to keep us consistent when interacting with customers or patients.

But sometimes consistent isn’t effective.

Have you ever been part of a customer or patient experience where the script was clearly being followed but lost its relevance?

When the task becomes more important than the empathy it creates a big risk. One that might create a detractor out of the experience instead of an advocate.

Make sure your standard approach always begins with gaining empathy and a way to check your assumptions.

Keeping empathy and good diagnostics at the beginning of your standard engagement process ensures your consistency is also effective.

The first budget cuts: innovation and market research

When confidence erodes in the company financials, what are the easiest costs to cut?

Usually innovation and market research.

The problem people have with both is a lack of short term results.

Sure it felt good to make the numbers more palatable today, but it hides a future reckoning.

Companies that refuse to stay close to customers and don’t work on different things to create value are stubbornly protecting the status quo. It’s also called complacency.

Perhaps instead of cutting budgets, we should be changing methods instead.

Creating value is the life-blood of every organization

All existing organizations create value. And the flip side is also true,

An organization that does not create value cannot exist. It is impossible.

Every organization that exists is creating value, for someone, at least one person, somewhere.

The moment an organization ceases to create value is the exact moment it no longer exists.

Creating value is the life-blood of every organization.