You Can ALWAYS Demonstrate Quantified Value

By February 23, 2011Differentiation

There is no excuse to not quantify the value you can deliver to a customer.  Collaboration and trade always produce value for both parties in the deal.  Think through the following.

Percy and Steve are cave men.  They have each independently discovered that a cave man can keep himself well fed on one fish per day.  They have each also figured out how to make fish hooks from bone.  The hooks are pretty fragile, though.  Each can only be used to catch one fish.

Percy can make a hook in 3 hours and with it can catch a fish in 4 hours.  Steve can make a hook in 2 hours and with it can catch a fish in 1 hour.  In other words, Percy needs to work 7 hours a day to eat.  Steve needs to work only 3 hours.

Not a thing Percy can do to help Steve, right?  Steve is substantially better at both critical skills and scoffs at Percy’s efforts to sell him fish hooks.  Percy is determined, however, to reduce the number of hours he needs to work.  He will not be deterred!  He decides to try quantifying his value.

Percy realizes that by working 6 hours per day he can produce 2 hooks.  He further realizes that with a ready supply of hooks, Steve could catch 2 fish in 2 hours.  Percy then changes his value proposition.  “Hey Steve, I can reduce your work time by an hour a day, interested?”  Percy explains that by trading one of his hooks for one of Steve’s fish, the magic can happen.  And better yet, it’s double magic.  Steve quits making hooks and saves an hour a day.  Percy quits fishing and also saves an hour day.  Steve now has time to invent that iPad he’s been thinking about, and Percy can work on building that microwave oven.  (Percy Spencer patented the first microwave oven in 1946.  You know what Steve went on to become.)

This productivity producing magic is not limited to hook-making and fishing.  It works for literally everything and anything.  And no, it’s not actually magic.  It’s the law of comparative advantage.  It was first codified by David Ricardo way back in 1817.  (More on the law here.)

It means that a sales rep can ALWAYS demonstrate quantified value.

So why don’t we do it?  I’ll tell you why…  Comparative Advantage is counter-intuitive.  It’s challenging to understand.  It’s difficult to apply to the more complex customer situations and products/services we sell.

It is, however, possible.  So why don’t you have a quantified value proposition every time?

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