This week the first Shaking Up the Value Chain presentation and workshop have been organized as part of Capgemini’s Multi Channel Retailing evening sessions. The evening started with a presentation of the ‘Shaking Up’ concept and during the second half all participants joined one of the interactive break-outs. The challenging assignment consisted of three questions: pick an Industry familiar to the group, draw the value chain according the new Shaking Up the Value Chain modeling method and finally come up with a plan to optimize the position of the ‘sqeezed brand’.

Good Shaking Up experience for all participants…

In the feedback round at the end of the evening the participants returned they liked the workshop because working with their own examples made the Shaking Up the Value Chain concept concrete and very clear. Because of the success of the evening this will certainly not be the last presentation and workshop, so keep track of the notifications on this website or leave a message so we can inform you about our upcoming activities.

…and you missed it, but it is not too late!

Missed this evening but interested in our unique Shaking Up Method®? Want to learn more about Margin Flow Modeling® or about the ‘Sleeping brand’, the ‘Brand Node’ and the ‘Margin Monopolist’? We are glad to elaborate with you or your company on your value chain position and our innovative three step approach to revaluate the brand. Feel free to leave us a message!

]]> http://www.shakingupthevaluechain.com/2009/04/fruitful-co-creation-during-the-first-shaking-up-the-value-chain-evening/feed/ http://www.shakingupthevaluechain.com/2008/08/shaking-up-the-value-chaincom-online/ http://www.shakingupthevaluechain.com/2008/08/shaking-up-the-value-chaincom-online/#comments Sun, 03 Aug 2008 14:25:27 +0000 Bun & Van Zijll Langhout http://www.shakingupthevaluechain.com/?p=78 Shaking Up the Value Chain helps you. Please be inspired by this method and our articles and workshops and get in contact via mail, LinkedIn, Twitter, Youtube or whatever you like.

This is no coincidence. Having a firm client relationship is key in acquiring the sweet spot in the value chain. Companies with direct end-consumer contact are in control of the value chain in today’s bottom-up market system. The connected brand is able to capture client’s desires and build on a solid customer database. Meeting these wishes will finally result in a reinforced brand image and more revenues.

Escape the value chain squeeze

The other brands, way up in the value chain, do not capitalize on this. They experience difficulties to change their position in the traditional value chain due to vested interests and old habits of thought. Their margins are shrinking because at the end they always will be the victim of power play and their unfavorable position in the value chain.

Next to this, they face another important consequence of this position: relevant customer information is biased due to the absence of a direct connection with the end consumer. The connected brand is willing to share some market information by which suppliers are able to make the right adjustments, but real consumer insights will not be provided. The connected brand is aware of the value of client insights, and ‘knowledge means power’.

When all disadvantages are clear, why isn’t there any action taken yet by most companies? It is becoming clear that companies struggle with the introduction of new innovative marketing techniques and they experience difficulties to establish a sustainable dialogue with the end consumer. Simply because they are not used to play that role. And often they fear the consequences of their fresh ambitions.

But some companies do take action. They realize the potential chain conflicts do counterbalance the potential benefits. Established market players lose market share over young niche players that take direct action to involve the customer. Take for instance DimDim: an innovative, open source web based meeting system. The website is gaining more and more customers because they engaged their user base from the start and gives them the opportunity to co-develop the source code, suggest emendations and discuss about future candidates. Due to its high customer intimacy, DimDim is able to gain market share over institutionalized market players as Microsoft with Netmeeting.

Start revaluating your spot in the value chain

It is not strange they succeed exactly at this time. Customer interaction has changed in terms of involvement, bargaining power and new communication channels. Consumers have become ‘prosumers’, actively involved with those brands that are willing to open up and invite consumers to participate in a part of the value creation process. Due to information overload, customers are becoming less sensible for traditional communication. They only communicate with brands that advocate an authentic two-way relationship.

In the mean time more and more products and services have become a commodity. Companies experience difficulties to differentiate with added value. They notice joint value creation might be the key to differentiate again. Real time, iterating product development is at hand.

To convince companies that are still in doubt, luckily success stories come up of traditional business-to-business organizations that successfully entered the consumer market. Linksys, as an example, is a brand evoked by the typical B2B player CISCO, who used its strong position in the IT server market to conquer the consumer market.

Therefore, it seems possible in terms of market and consumer trends to shake up the value chain. There is a chance to escape the value chain squeeze and it is possible to change an organization to become most relevant to the end-consumer. But where to start?

Changing your organization to become most relevant to the end-consumer

Becoming most relevant in the value chain means a shift from a traditional ‘push’ to a more innovative ‘pull’ go-to-market strategy. In realizing this, an innovative end-consumer interaction has to be established and a new internal organization - which autonomously manages the new value chain position - should be designed. Two Capgemini Business Innovation consultants, Jaco van Zijll Langhout and Eric Bun, developed a practical approach to start with. The approach consists of three manageable steps with measurable results.

Step One is about making the first connection with the new target group. The brand has been invisible for them till now. This group will be asked to come up with ideas to improve a specific situation in which the consumer and the brand are both involved. During Step Two the new relationship will be strengthened, extending the brand awareness. The existing marketing activities will be adjusted to match the new target group. In the final Step Three a multidirectional platform will be established as a central point for new product development and sales.

In this way every organization, no matter the industry or branch, will be able to shift to the most favorable value chain position. Finally the brand cannot be neglected and will be an important part of the experience while using a specific product or service. Compare this with the Intel brand: first the chip manufacturer represented no value for most consumers, nowadays A-status PC brands put an ‘Intel Inside’ sticker on their hardware to use it as a Unique Selling Point.

Parts of the Shaking Up the Value Chain are successfully introduced at a Dutch Telco in order to build a new business community.