Why value creation is better than a strict policy

Reylito A.H. Elbo

Reylito A.H. Elbo

FOCUSING on results is one thing, but figuring out how they came about is something else. You may have achieved something, but chances are you may have also spent tremendous amount of resources. That’s hard working, not smart thinking. So, how can you determine the right outcome with the right process, using only the barest of resources?

For instance, of the things presented to you by your boss, colleague, customer, or business partner, have you taken the chance to offer a counter-proposal? “Sir, if you don’t mind, I think there’s a better way of doing it, at the least possible cost. Would you like to hear it?”

That’s one serious suggestion you should always offer to people. That’s value creation. It means generating and offering your prized ideas to people who may not even think that such ideas exist in the first place. Value creation is an important strategy that business organizations do when dealing with customers, suppliers, and subcontractors around the world.

Of course, it takes two to tango. If your customer or supplier says your idea is not valuable, then it’s time to be patient. Maybe you need more explanation or illustration to convince the other party. Or maybe you need to elevate the matter to the higher-ups. Take the case of what we’re doing in events management. Aside from our favorite five-star Makati hotels, at times we need rooms at some restaurants or three-star locations for our budget seminars, normally patronized by SMEs (small and medium enterprises).

One day, in the course of scouting a restaurant along Pasay Road, we chanced upon an old favorite, which was popular in the 1990s. This is not picking on one particular restaurant, that’s why I will not mention its name here. This is our story. We need to enter the restaurant as early as 8 a.m. to prepare for a whole day event that starts at 9 a.m.

The trouble is that the event coordinator says opening at 8 a.m. is not acceptable because they have a strict policy of opening at 9 a.m.

“How strict is strict?” we asked. “Suppose we pay for the overtime premium of the workers and related expenses, would that pose a problem?”

“You can keep your money, Sir. But that’s our STRICT policy. Besides, you’re not the first one to ask for that one-hour early opening.”

Of course, we have no recourse but to go someplace.

This particular restaurant forgets that their business is all about customer service. And so be it. We, as customers, usually choose a restaurant or hotel over another, not only because of the price, facilities, quality and quantity of its service, but for something else–professional flexibility, if not management common sense.

Because they lack common-sense, they lost P20,000 in revenue and the opportunity to an almost perpetual, mutually-profitable professional relationship. It’s one patently wrong outcome for that restaurant to emphasize that they’ve a strict management policy.

Such situation can be a powerful experiment for value creation. If people can’t see value though the customer’s eyes, so be it. No amount of market survey can do that for you because sooner or later, you can encounter customer who has one peculiar request you can’t even imagine.

Now, applying a bit of psychology, can you toilet train a cat, in the same manner when you condition the mind of a strict manager who firmly believes in his command-and-control policy even if it’s negatively going against the welfare of his workers and the establishment?

First, accept the fact that common-sense is uncommon. Second, have a good amount of positive energy that everything can be resolved no matter how strong the opposition is. Third, generate several excellent arguments that a strict policy is ruining the other person’s business. Lastly, illustrate how your idea can create mutual value for everyone.

The basic rule of value creation is one that I learned a long time ago from one of my bosses. Regardless of one’s hierarchical position in an organization, never believe someone who is wont to say: “My way, or the highway.”

Rey Elbo is a business consultant specializing in human resources and total quality management as a fused interest. Send feedback to elbonomics@gmail.com or follow him on Facebook, LinkedIn, and Twitter for his random thoughts on management.


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