value proposition – the threshold

Again I find myself in lots of discussions about value propositions. This time in the context of Enterprise software. The same rule holds.

A person will start to use software when using it is easier than not using it.

In the case of Enterprise software, sometimes “easier” can be a little different – like its absolutely required or you won’t get paid. But basically, there are 2 things you can do to tip the balance. The first is to do something so valuable, that people want to use it. The second is to do something so much easier than people can do it now, that people will use it. This kind of means that the less you offer the easier it must be to do it, or conversely, the more you offer, the more people will put up with.

Enterprise software is a little different – the people who use the software are rarely the people who bought it. People use it because they’re told to, or because its the only way to get certain information. So enterprise software companies haven’t bothered to make the tools easy to use, and integrators, like SAP, Accenture, etc., don’t help that situation much.

The good news is that its slowly changing. People who use enterprise software are also consumers, and their expectation is that stuff should work. Good work, software dudes. 15 years ago all software sucked. Now, most consumer software’s pretty usable. Our expectations have been raised, and the enterprise is next.

How do you know when you’ve got the right value proposition?

Last month, I wrote a post about the Value of a Value Proposition .

It must be a useful subject, because almost all of my search engine traffic comes to this one post. Again today I found myself talking about the value proposition with a client. Its the most precious thing you have – its what is valuable about your product or company. And it isn’t always easy to formulate or agree on.

Here’s some hints about the process:

- If your value proposition takes two paragraphs to describe, you aren’t done yet.

- If you don’t have any customers or potential customers who say – yes – I have that issue, I need that solution, then you aren’t done yet.

- If you need to rehearse the sentence to get it out of your mouth properly – you aren’t done yet.

If everyone in your company or team, when asked, will spontaneously say something more or less identical – you’re getting darn close.

Now – just because you aren’t done yet, doesn’t mean you don’t have something really special. What it does mean is that you haven’t yet made that connection between whatever brilliant insight you have and your customers world view. So what can you do about this?

1. Talk talk talk talk and then listen, listen, listen, listen.

Tell as many people as will stand still about your idea. You’ll probably go through a phase where you’ll get one of two responses:

- blank faces

- one or two people (who probably like you a lot for whatever reason) will tell you that you are a genius.

This is not a good phase. And I’ve spent some quality time here. The best thing to do here is to try to get those blank faced people to talk more. And, of course those people who think you’re a genius too – but its more important to be able to explain it to the blank faces. Ask them (if they haven’t turned away yet) to help you by explaining back to you what they think you might be saying. And listen. Don’t dismiss – even if you think they have no vision. They may have no vision – but neither will 99.9% of your future customers and investors. You really do need to be able to explain it.

Another technique – draw a chart. Make a picture of what you think you’re offering. Now make a completely different chart to describe the same thing. In other words try to look at the problem in lots of different ways, get creative about seeing it from other people’s perspectives. Try a usage table – a tool I use quite a bit – one column is a list of possible users, the second column is the value they’ll get out of the product, the third are the features that support this. Once you’ve nailed your value proposition, this is also a nice tool for the development of your Product Requirements.

Focus groups. If you have the ability, try a focus group. I’ve seen the value proposition fall out of the most unlikely mouths while standing behind a one way mirror, after we’d worked on it for months. A different, objective perspective can be very illuminating.

Online surveys. Once you think you’ve got it. Consider it an hypothesis. Use an online survey to test your hypothesis. Online surveys are cheap and easy. The hard work is in formulating the right questions, developing your email list (not all that hard, if you know your audience) and most importantly, listening to the results – especially if they are not what you predicted.

Once you have the right value proposition, it will feel right. It will be easy to describe. People will nod their heads. Survey results will start making sense. The product, design, marketing, positioning, everything will begin to fall in place, and all thats left is to execute flawlessly.

Good news – I think my client’s got it. Its short, its sweet, he and the team can repeat it easily, and people get it. Yipee! Now to that flawless execution….