While most of us are familiar with the concept of risk management, it’s rare for marketers and their agencies to address issues of “value management” and look at what really constitutes “value”…
In my view, value is a risk in-and-of-itself if it’s not proactively addressed and managed in the same way issues around risk are proactively managed.
So why not value?
Value management is simply a methodology for weighing up the expected value from a service – in this case perhaps the value marketers should reasonably expect from their respective agencies.
To be clear, I’m not talking about price or costs, I’m talking about the concept of value and defining what constitutes value. It might be exceptional thinking, it might be programs that deliver a straight line to results, it might be quality of resources assigned to your business. It could be all of the above. Or indeed anything that you and your teams want to measure as valued contribution.
Not sure? Well here are some great reasons that defining value can help the relationship between you and your agencies and ultimately help build your business:
Clarification of objectives
By defining what constitutes value from your agency or agencies, you can focus them on specific objectives that will help drive that value on a consistent basis. If they don’t know what you perceive as “value” don’t be surprised if they don’t deliver it.
Aligning of resources
Once you define value within your own organization and communicate that to your agency teams, you immediately begin to build alignment between marketing and agency resources. Value definition then becomes a tool to help everyone pull on the same proverbial rope.
For marketers with multiple agencies, defining value helps teams play their respective parts with a clearer understanding of what partner agencies have been tasked to do and why. By tailoring value mandates for each of your agencies, you can then share those mandates with all agencies to provide greater clarity on their respective roles in the value chain.
With your internal teams focused on delivering value, briefings can contain better, more focused statements around objectives and expected results. Why not include a “how value will be measured…” statement in your marketing briefings?
Identify issues (faster).
If you experience pushback from within your organization or from your agencies around your expectations of value, you can quickly isolate why your value expectations aren’t achievable. Better to find out now that your teams can’t deliver on your expectations than to have to explain it to the CEO six months from now.
Marketers often tell us they have difficulty defining KPIs in the context of performance-based contracts. But with a statement of definition around your view of value, it should be easy to extrapolate KPIs from your defined values.
The right message
Communication around “value” sends the right message to your teams on many levels. In addition to letting your teams know you’re defining value expectations (beyond price and cost) and that you have specific measures associated with value, you’re also sending the message that executive management is behind the value propositions you’ve communicated.
By clearly defining value you’re empowering your teams to deploy resources appropriately to deliver on your value expectations. Failure to deploy effectively will likely throw up a red-flag when you come to evaluate value delivery.
Perhaps a little like turning on a light in a darkened room, you might be surprised how agency teams respond when you define your expectations around value. Their “assumptions” will quickly morph into value delivery action items.
Focusing on value will likely cause internal and agency teams to rethink (or at least re-evaluate) how they’re going to deliver on your expectations. And with a new and defined focus on value delivery, innovation will likely follow.
If you could achieve all this by defining what really constitutes value in your organization and your expectations around value from each of your agencies – why wouldn’t you create a “value management” program in your company?
What are you working on? And how can we help you create better value?
Stephan Argent is Founder and Principal at Listenmore Inc offering confidential advisory to marketers looking for truly independent insight and advice they can’t find anywhere else. Read more like this on our blog Marketing Unscrewed / follow me @StephanArgent
Photo: Jeremy Segrott