Project Delivery to Value Creation

Within this turbulent economy that includes quickly changing national priorities and reduced political cooperation, there is true chaos and havoc being wreaked on the federal landscape (Neumark, Muz, & National Bureau of Economic Research, 2014). Almost each agency grapples with increase performance mandates, reduced risk tolerance, and lower budgets. From this arises an environment of smaller opportunities, compressed margins, and lower labor rates. Because of these many businesses fail. What can companies do to survive the pitfalls of current existing market conditions? They need to create value.
Companies and businesses aim to provide value for their customers through additional services and benefits. For example, Amazon.com, Inc gives customers an excellent return policy where the company pays for return shipping and if a customer is unhappy with their product, they can get a full refund (Davis, 2016). Furthermore, Amazon.com, Inc, makes it easy for customers to speak to a customer service agent quickly from online, or over the phone. Such ease in communication makes an intangible value creation. Customers like having the ability to easily contact a company with a concern or issue. By Amazon.com, Inc providing excellent customer service, they create loyalty among their existing customer base. “With Prime, Echo and its ever-broadening Web Service’s business, Amazon is slowly but surely becoming the world leader in delivering on its brand promise: being the "Earth’s biggest selection and being the Earth’s most customer-centric company” (Davis, 2016).
That loyalty translates to higher rates of purchases and higher profits. While it costs resources to maintain an excellent customer service, Amazon.com, Inc takes into consideration what amount of money it would be lost if they did not have the additional value in their company. These things need to be considered when it comes to running a successful business. While some things can and should be implemented to generate value for the company, expenses and available resources need to be examined to avoid potential pitfalls. Furthermore, a determination must be made as to whether the addition of such value is enough to generate long-term profit.
For example, value=Contribution/Cost (Schiuma, 2011). When a product or service has a lower cost and higher contribution to customers/clients, it is very valuable. Cost can go both ways regarding cost to client/customer or cost to the company. Customer service is often free to the customer but can be costly to the company. Customer service is something many companies aim to strive for because by addressing customer needs, a company offers the highest contribution (Schiuma, 2011. Therefore, sometimes in companies like Microsoft, they may outsource their employees from countries like India, to provide value to customers, while minimizing their expense. A trend seen in many companies within the United States. “An increasing number of firms are outsourcing customer support to external service providers. This creates a triadic setting in which an outsourcing provider serves end customers on behalf of its clients” (Wuyts, Rindfleisch & Citrin, 2015).
In fact, it has become such a prevalent action because of the growing need to address customer concerns both online and over the phone. Customers want to be able to have the convenience of solving their problems online through chat or email and so companies must pay for this kind of service. Since it can be done remotely they look towards other countries where the pay for a typical employee is much lower than in developed countries like the United States. This creates value for companies because they can maintain their level of desired customer service, but also keep expenses low.
The findings reveal that customer-focused providers achieve higher levels of customer need fulfillment but this effect is contingent on their ability to serve end customers. In particular, customer-focused providers more effectively fulfill customer needs when clients and providers share close relational ties, when clients also have a high level of customer focus, and when end customer needs exhibit a low degree of turbulence (Wuyts, Rindfleisch & Citrin, 2015, p.40).
Focusing on the needs of the client is what makes or breaks companies in such a chaotic economic and political climate. That means making the commitment to excellent leadership and management to create and continue providing excellent service (Mahajan, 2016). To accomplish such a goal, companies must generate and embrace a unified purpose and objective beyond wealth creation, and instead produce extraordinary value for clients/customers. Additionally, companies must assess on an ongoing basis, financial performance. Financial performance is a main measure for assessment of value creation effectiveness (Mahajan, 2016).
When effective leadership is in place along with a universal goal to meet the needs of the customer, then there needs to take place an investment in the company’s greatest assets. Typically, the workforce is the greatest asset. Whether a company outsources a workforce or maintains a domestic employee population, the quality of these employees generate value for the company. With effective leadership in play, companies can train their employees well and promote an environment focused on meeting objectives like excellent customer service.
Going back to Amazon, they have a means of continuously assessing employee performance through customer feedback surveys. Many companies have this and allow management to identify which employees perform well and which fail. These measures are key to maintaining high value in a company. Without these measures it can easily become difficult to perform well.
This leads into the last aspect of value creation. Maintaining efficiency. By establishing a culture of efficiency with clients, value creation occurs quickly (Dudycz, Osbert-Pociecha, & Brycz, 2016). The aim is to lower the expense but increase the value to the customer. Companies can do this through accelerating schedules, including lower-cost virtual technologies, and consolidating or shedding ineffective infrastructure (Dudycz, Osbert-Pociecha, & Brycz, 2016). By having processes in place to measure ineffective actions and costly underperforming structures or employees, a business manages to provide enough value without spending more than needed. Software has become a growing trend for customer service related needs, diminishing the cost of additional customer service representatives.
In conclusion, value creation is a multi-step process. It involves the use of various resources and implementation of a multitude of measures to ensure companies provide a product or service that increases customer loyalty and therefore increases profits. Companies may elect to outsource some of their workforce to reduce costs while at the same time provide the same level of excellent service. To do this, companies must focus on having effective leadership and an ongoing means of evaluating employees’ work performance.
When companies achieve this kind of customer-centric vision, while also reducing expenses, they may achieve a level of success like Amazon.com. Amazon has provided customers for years now, a level of customer service that few companies match. This therefore has allowed the company to maintain its position as an online retailer and even expand into other fronts such selling of their own products and so forth. Although it may be difficult to achieve this level of value creation, companies should still focus on value creation as it may be the competitive advantage needed to stay afloat in such turbulent times.


References
Davis, S. (2016, July 14). How Amazon's Brand and Customer Experience Became Synonymous. Retrieved from https://www.forbes.com/sites/scottdavis/2016/07/14/how-amazons-brand-and-customer-experience-became-synonymous/#6db1672c3cd5
Dudycz, T., Osbert-Pociecha, G., & Brycz, B. (2016). The Essence and Measurement of Organizational Efficiency. Springer.
Mahajan, G. (2016). Value creation: The definitive guide for business leaders. SAGE Publishing India.
Neumark, D., Muz, J. E., & National Bureau of Economic Research. (2014). The "business climate" and economic inequality.
Schiuma, G. (2011). Managing knowledge assets and business value creation in organizations: Measures and dynamics. Hershey PA: Business Science Reference.
Wuyts, S., Rindfleisch, A., & Citrin, A. (2015). Outsourcing customer support: The role of provider customer focus. Journal of Operations Management, 35, 40-55. doi:10.1016/j.jom.2014.10.004