Value Elements

When discussing the elements of value creation through the delivery of services we always talk about customer preferences, perceptions and the business outcomes they generate.  We also throw in the elements of utility and warranty.  These are all critical in ensuring our ability to create value for our customers and capture value for ourselves as service providers.

The service relationship between service providers and their customers revolves around the use of and interaction of assets.   Assets are made up of both resources and capabilities and are provided by both the service provider and the customer.  These are critical value elements in the creation of usable, customer aligned services.

Many of our customers utilize our services in conjunction with their own assets to then build and deliver services or products our customers then deliver to their customers. We, as the service provider, consider these customer assets.  Without these there would be no basis for defining the value of a service. Therefore, performance of customer assets is a primary concern for service management. 

Organizations use resources and capabilities to create value in the form of goods and services.  Resources direct inputs for production.  Capabilities represent an organization’s ability to coordinate, control and deploy resources to produce value. They are characteristically experience driven, knowledge intensive and information based.  They are derived from the organization’s people, systems, processes and technologies.

Service providers must continually develop new and distinctive capabilities that align to the changing customer needs in order to retain customers with the suitable value offerings that would be difficult for the competition to duplicate, thus giving us the competitive advantage.  These must be balanced with the appropriate and adequate resources which the service provider is dependent upon for the delivery of fitting services.

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