One way to envision new products and services your company can offer to its key customers is to visualize their value chain – the steps from raw material to finished product from their perspective. As a supplier to these key customers, your firm represents one step in their value chain – the process from raw materials to finished product.
The problem is that many firms operate with too-rigid definitions of what their mission is. They may say “we’re in the widget business, and that’s all we do” – an approach that is you-centric, rather than customer-centric. As a result, you may be missing major opportunities. If you take a look at your customer’s value chain from their point of view, you can often see new opportunities for partnerships and cooperative agreements with suppliers involved in adjacent steps to the one that you perform. Visual thinking can help you to map out that process.
You can use a business diagramming program like SmartDraw to map out the value chain and visualize where opportunities may exist.
Here are some questions you should ask as you consider these opportunities:
- What process does your customer follow to get work done? Where do you fit on that value chain?
- Look at adjoining steps to you. Who could you partner with to add more value to your customer?
- What are the inputs and outputs at each step? Add them to your process map. Knowing what these are will help you to brainstorm new partnership opportunities and product ideas.
The flow chart above is an example of a customer value chain map. MindMatters develops and markets enterprise software for idea management. Recently, the company launched Flagpole, a web-based crowdsourcing tool that enables companies to deploy web portals for soliciting ideas from the public.
Recently, MindMatters announced that it will integrate Flagpole with 37Signals’ popular BaseCamp web-based project management tool, which will enable firms to take the most promising ideas they have gathered and implement them in BaseCamp. In the process map above, you can easily see how partnering with a project management supplier adds significant value to MindMatters’ customers – by providing them with more of an end-to-end solution.
Note, too, there’s another opportunity farther upstream, at the idea generation stage. MindMatters may want to think about who they can partner with to help Flagpole users to generate more and better ideas!
Why not give this technique a try in your business?