The Secret to Success: Create Value (Part 2)

The G-STIC Framework 

G - Setting a Goal

This is a pivotal part of the strategic planning process. Without a clearly defined goal, the other elements of the value creation process, and the overall success of the business, are doomed for failure.

There are two decisions involved with goal setting: identifying the focus of the businesses actions and setting specific benchmarks for measuring the business’s performance. The focus determines the key element of a business’s success and often includes elements such as net income, sales revenues, and market share.  Benchmarking looks at the goal and defines its temporal and quantitative aspects.

S - Developing a Strategy

A strategy outlines the activities that are needed to accomplish the business’s goals. This element is characterized by two key decisions: Identifying target customers and developing a value proposition.

The markets in which a business’s offerings compete can be best illustrated by the 5-C framework.

Figure 1: The 5-C Framework

Customers: Potential buyers who have needs that the business’s offerings aim to fulfill

Company: The business managing the offering

Collaborators: Entities that work with the business to create value for target customers

Competitors: Business’s whose offerings target the same customers

Context: Relative aspects of the environment in which the business operates

Target Market

Identifying your target market involves two key decisions: selecting which clients to serve and identifying actionable methods for reaching these clients.  Selecting which clients to serve, also known as strategic targeting, is done based on the businesses ability to fulfill a client’s needs in a way that is beneficial to the client, business, and collaborators. Often, a client’s needs are not easy to see, so a business will need to identify observable characteristics that can be used to reach the client, also known as tactical targeting. These characteristics may include demographic, psychographic, geographic, and behavioral factors.

Value Proposition

As you have probably noticed, mutually beneficial value is a major theme in almost all discussions about marketing. True business success is achieved if a business creates a product offering that provides a client with more value than the competition’s offering in a way that creates value for the business and the collaborators. The value proposition is simply a definition of the value that the offering creates. This value proposition includes all of the benefits and costs associated with the offering. The next step is to define the positing strategy, which highlights the most important benefit of the offering. The most important benefit should be poignant and serve to differentiate the product in the mind of the client.