Value dominant logic: helping individuals and their companies to succeed

235 Pages·2018·8.425 MB·English

by  Mahajan, Gautam

Endorsements
“Gautam opens our eyes to the significant role played by value, value creation and
value destruction in our business and personal lives. You will inevitably do things
differently and better after reading this book.”
Philip Kotler, S. C. Johnson Distinguished Professor of
International Marketing, Kellogg School of Management,
Northwestern University
“In order to Create Value for customers, one must first Create Value for the
providers, including employees, suppliers, the society at large, etc. ‘The goal is to
improve the quality of life, such that the well-being of human actors is continuously
improved.’Thesearethecredosguidingthisbook,expressedbyGautamMahajanfor
thedevelopmentandmanagementofValue.Inthebook,waysofimplementingthese
thoughts are discussed. This is an important and educating book about Value and
how to Create Value. I enjoyed reading the book.”
Christian Gronroos, Professor Emeritus,
Hanken School of Economics, Finland
“Value Dominant Logic certainly clarifies the concept of Value, the need for it to be
the dominant thought in all that a good corporation or organisation should be
strategising about. [It] was very readable. An excellent new contribution to the
whole debate on and the need for Value being predominant.”
Arvind Pande, former Chairman and
CEO of the Steel Authority of India
“One of the biggest myths today is that technological advances cause disruption. The
realityisthattheso-calleddisruptorsjustfindbetterwaysofcreatingvaluebymaking
our lives easier and more fulfilling.
This, however, is just one of many aspects of value dealt with in this comprehensive
book on the topic.
I have met and worked with Gautam Mahajan and am an avid reader of all his posts
on the topic of value, so it was with great joy that I discovered that he had collected
together all his knowledge and experience on the topic in this wonderful book.
Gautam is a world authority on every aspect of value and this book is filled with his
wisdom. What is remarkable, however, is that unlike so many books, his is an easy
and highly enjoyable read to boot.”
Professor Malcolm McDonald MA (Oxon)
MSc PhD DLitt DSc, Emeritus Professor,
Cranfield University School of Management
“This bookprovides and paintsa much-neededbroad and richcanvasin relationtoa
vital issue for the 21st Century – value creation. The book will provide thinkers and
practitioners with considerable food for thought and is a provocation to debate. It
usesavarietyofusefullayoutsanddiagramsinordertomakeitsinsightfulpointsand
managers and directors will glean many valuable ideas for practice in this timely
work.”
Professor Peter Stokes (PhD MBA PGCertRDS
PGCertTLHE Cert Coach BA (Hons)
Snr FEMRBI (Vice-President/Country Director),
AGRH (UK Ambassador) FHEA FRSA FCMI),
Leicester Castle Business School, De Montfort
University, UK
“If value creation is at the core of your strategy, this book is a must-read. I
particularly like the perspective and in-depth discussion of value creation for key
stakeholders, including customers, employees, partner, shareholders and society-at-
large. It is a beautiful book, I love it!”
Dr Jochen Wirtz, Professor of Marketing and Vice-Dean
Graduate Studies, NUS Business School, National
University of Singapore
Mr Gautam Mahajan is a Value Creator Thought Leader and has written an exciting
and informative new book, Value Dominant Logic (VDL):
How do you describe a man who is branded as Mr. Customer Value and a maven in
his field of expertise that encompasses all that stands for Value Creation? He is
definitely not a man you can define in a few words. He is the A-to-Z of Value
Creation and the true Custodian of Customers.
I had the pleasure of meeting Gautam Mahajan around 2015 at a Direct Marketing
Association Indiaevent in Mumbai. We sought each other out after anexciting panel
discussion and my first observations was that he is focused, inspiring, motivated,
dedicated, quiet but determined and has the knowledge and experience on how to
create customer value. The emphasis on Customer, who is the centre of our business
Universe and our Economy.
I’m an avid reader of his writings, be it books, blogs, articles or white papers and am
impressed with the clear and simplistic writing style he uses in sharing his invaluable
knowledge on this complex subject.
I have been aware, for many years, that our customers suffer from an affliction called
‘Value Starvation’. And his new book Value Dominant Logic (VDL) has answered it
by explaining with varied industry examples, step-by-step and chapter-by-chapter,
how to find value and pay it forward to all those that touches our lives.
Gautam is a man that leans into value and pays attention to when and where it
should be created – and how. He believes in ‘every touchpoint becomes a potential
brand-building activity and potential point of activation and retention’. In VDL he
showsthatvalue isnota onceof‘gift’, butco-createdbyallinvolvedintheircircleof
convenience and accessibility. It forms part of the journey we walk with our
customers and the experiences we – or they – create with us.
There is no clear definition of value. Value can be defined in many ways and across
many actions and interactions. Value is all about micro-moments that transforms
‘companies to focus on creating value for their customers by aligning each person’s role in
creating the value customers so desperately look for and getting shareholder wealth and
value’.
VDL clarifies many of the uncertainties of what real value represents. It is different
for different people and within their different circumstances. Value is directly linked
to peoples’ experiences throughout their journeys.
Gautam recognises that customers reward companies with their loyalty and time,
increased business, market share and share of wallet and profitability. Understanding
and implementing Value Programs is a customer value investment that needs to be
budgeted for and seeks a handsome return.
With his solutions-driven personality and sharer of knowledge and experiences, I
believe VDL will be a disruptor and distractor – with technology to match – to the
complacency of many marketers in this ‘cross-device’ world.
Gautam is an acclaimed author of many books on value creation, VDL is an
excellent addition to his already well-read collection of books.
Thanks for sharing your time and knowledge with us, Gautam. I wish you well with
converting many new and informed value creators from reading and studying Value
Dominant Logic.
Mayitfindaplaceofprominenceineverylibrary–personalorbusiness–aroundthe
world. A Value waiting to happen.”
Winnifred Knight, Managing Director and
Owner – CUBE [ON THE SQUARE] Pty Ltd
and TheMarketingSite, Trainer/Mentor:
Practical Direct, Data and Digital Marketing
Workshops, Train-the-Trainer Workshops,
Consultant and Professional Speaker,
Email: [email protected]
Value as an Interactive, Reciprocal Organisational System
“This book will revolutionise how you think about, consider and employ value no
matter your position or role in commercial or human activities. It is a ‘must-read’ for
any and everyone involved in any type of commercial organisation.
Value has traditionally been defined vary narrowly, i.e., the creation of worth by one
personorpartyforanother,oftenviewedthroughafinanciallens.Mahajan,inthiswide-
ranging text, shows that Value comes in many forms, impacts and influences for many
participantsand is a key element in all human interactions relatedtothe firm. Value is
notjustamarketingtermortechnique,insteaditisaholistic,integratedwayofthinking
aboutallhumanrelationshipsandinter-actionswhichmeansitinfluencesandimpactsall
levels of the organisation. In this example-laden text, Value is not a ‘thing’ but an
interactivesystemthatcanbecreatedordestroyedbyallparticipants.Itiscommunica-
tionandbehaviourallybased,reciprocalandeverchanging.”
Don E. Schultz, PhD
Professor Emeritus (In Service)
Medill School of Journalism-Media-Integrated Marketing Communications
Northwestern University
“Creating Value incorporates many important concepts, including customer service
and the thought process of how people can add value to not only customers, but
bosses, fellow employees and more.”
Shep Hyken, customer service/experience
expert and New York Times bestselling
author of The Amazement Revolution
I often say that, in terms of the evolving role of business in society, we are in the
decade of value creation – of rethinking what we mean by value, how we measure
value and to what extent we are collectively creating or destroying value. Hence,
Gautam Mahajan’s book, Value Dominant Logic, could not have come at a better
time. By building on his long experience with foundation concepts like customer
value, Mahajan casts the net broader and findsthat value creation is a helpful lens for
other spheres of business and life – whether it be Prof. Freeman’s concept of
stakeholder value or my own notion of integrated value. The book also provides
compelling evidence for what I call the ‘values dividend’, which is the extensive value
that is created for society when individuals, communities, companies and govern-
ments use self-transcendent (non-selfish) values as their guide for action. At a time
when value destruction is still so pervasive in politics and economics, Value Domi-
nant Logic may be the very catalyst we need to turn the tide.
Dr Wayne Visser, Professor of Integrated
Value and Chair in Sustainable Transformation
at Antwerp Management School
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Value Dominant Logic
Helping Individuals and Their
Companies to Succeed
by Gautam Mahajan
Firsteditionpublishedin2019
byRoutledge/ProductivityPress
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©2019byGautamMahajan
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Contents
Preface...........................................................................................................xv
Acknowledgement.......................................................................................xvii
AbouttheAuthor..........................................................................................xix
ValueDominantLogic(VDL):Introduction................................................xxi
1 ValueDominantLogic...........................................................................1
ThePrinciplesofValueDominantLogic....................................................2
TheEightPrinciplesofVDL......................................................................2
WhatIsValue?............................................................................................4
TheElementsofValue................................................................................6
ValueandSatisfaction.................................................................................6
MeasuringValue.........................................................................................6
VDLandValue...........................................................................................8
ValueWaitingtoHappen...........................................................................8
DisruptionandValueWaitingtoHappen............................................13
VDLandValueWaitingtoHappen.....................................................14
ValueandYou..........................................................................................17
CreatingValueforYourself...................................................................17
CreatingValueforYourselfMeansCreatingValueforOthers..............20
ValueStarvation........................................................................................21
Value,ValuesandHappiness....................................................................22
Values.......................................................................................................24
UnderstandingWhatYouFindofValuetoYou...................................25
ThePrinciplesofVDLandThisChapter.............................................25
2 ValueandDisruption,DilemmasandDecision-Making.....................27
BusinessDilemmas...................................................................................28
ValueandDisruption................................................................................28
DoesDisruptionCreateValueorDestroyIt?............................................29
TheSeedsofDisruption...........................................................................34
ix