CEOs are measured on outcomes and what the company has achieved under their leadership. Subjectively saying that a company has done well or that a CEO has performed well has no meaning unless it is backed by metrics that demonstrate what has been achieved. Even more important here is the value addition that the CEO has been able to achieve and demonstrate.
So what is Value Addition?
Outside of economics, ‘value added’ refers to "extra" feature of an item of interest (product, service, person etc.) that go beyond the standard expectations and provide something "more", even if the cost is higher to the client or purchaser. Value-added features give competitive edges to companies with otherwise more expensive products.
The famous philosopher Aristotle once said-
‘The whole is greater than the sum of its parts’
If a leader is only able to get a sum of the output of individuals then he or she has not really accomplished much. To be a successful leader you have to bring out more in a team than what each of them can accomplish alone.
In today’s competitive world the value you add can differentiate you significantly from the rest of your competitors.
So, how to add significant value to anything you do?
First, define the best outcome that you think is possible
In any important task that you do clearly define what is the best possible outcome possible. When I say define, you need to specify using objective criteria than makes outputs measurable rather than defining it subjectively.
Let’s say you are in a sales role and you are assigned a target sales output for the year along with a target for collections and customer satisfaction. You also have a team of say, four people.
What you need to do is to understand your target completely. This will be your starting point. In this case, your outcome has already been defined for you. If you look at any other task or goal that you need to accomplish or achieve then you will need to specify the outcomes as objectively as possible.
Second, Identify what you can do differently over and above your targets
What you already have is your target. From a value add perspective, you need to think what you could do differently or above and beyond your goals to add significant value. This assumes that our target itself is quite stretched and not something that you could comfortably achieve. For this purpose, you could consider the following areas:
- Can you get the majority of your team to surpass their assigned individual targets of sales, collections and customer satisfaction?
- Instead of selling to existing customers alone, can you acquire a whole new set of logos (read new customers)
- Can you achieve the team’s target with lesser numbers in the team, which means can you generate more business from less?
Identify what you intend to target to add value. When you go over what is expected of you and do more with less or do something significantly innovative, you would have added value above and beyond what was expected of you.
Third, Get out of the Entitlement-Mindset
Some years ago I visited a Government Ordnance Factory in one of the northern states of India. The General Manager (GM) there took me for a guided tour of the factory. When we came to the shop floor area, I found a number of workers simply lounging around doing nothing. A little further I encountered a group of four workers who were smoking right below a No Smoking sign. The strange thing was the workers made no effort to put out their cigarettes or move away when they saw the General Manager coming.
Intrigued by their behaviour, I asked the GM what was happening. He said this is more of a mindset of the workers than anything else. When I persisted and asked him what he meant by mindset he explained that these were all workers on the government payroll who believed that they were paid to just come to the factory.
One of the worker representatives had even gone to the extent of asking him - “We have come to the factory and punched our card at the gate so our salary is due to us. What will you give us in addition to our salary if we also do some work?”
Over time, sometimes we develop an entitlement mindset where we start to expect a promotion or a raise simply for doing what we were expected to do. To get a promotion you need to demonstrate how you are already performing at a level above where you are.
Getting out of the entitlement mindset will empower you to push yourself even when no one is expecting you to and deliver quantum outcomes that no one can ignore!
Fourth, Develop a mindset of value addition
Value addition is possible in any sphere of activity that you engage. What is required is that you focus on adding value.
Some years ago I was resolving a dispute between the company I worked for and a client. This dispute had become increasingly acrimonious and internally the company had already made a provision for losses on account of this dispute.
When I was brought into it, I decided that instead of trying to settle the dispute within the boundaries of the loss provision made by the company, I would aim for an amicable settlement with no payment of any sort.
This very thought opened up new possibilities and I felt energised in the face of a problem. The company gave me a deadline within which I had to get a complete resolution. I managed to get a no-fault settlement with no payment whatsoever with three days to go before my deadline.
All this happened because of thinking that even in a situation that appeared to be No-Win, a better solution was feasible.
Thinking how you can add value in any situation can be a powerful way to come up with really innovative solutions and also motivate yourself to go above and beyond the call of duty.
Fifth, In your interactions with people, ask what you can do for them instead of what you could get from them
You interact with a lot of people every day for a multitude of reasons. However, very few people build deep relationships. Most of their interactions are restricted to getting what they wanted from the other person. When your focus is only on your own needs your interactions tend to be transactional and relationships shallow.
For instance, you go to a client for a sign-off on your deliverable and you land in his office first thing on a Monday morning, completely oblivious to the fact that his week has got off to a bad start and that he is in a heightened state of stress. Now after a brief greeting, you start badgering him for a sign-off, what do you think the outcome will be? I would say it is anybody’s guess!
What you have done is to demonstrate a spirit of entitlement believing that you have done your work so it is now the client’s duty to give you a sign-off and process your payment, the moment you show up in his office.
Things don’t work that way in real life.
If instead you had thought ahead of what would be a good time to meet your client which could be in the afternoon a little later in the week and then spent some time discussing the client’s feedback on your team’s work as well as understanding what in his view needed to change or get done, your meeting would have gone very differently.
Ignoring relationships can be detrimental to your interests. The fact is the client has hundreds of ways to delay acceptance of your deliverable as well as your payment if you end up antagonising him.
When you think from another person’s perspective and try to add some value to every interaction, you could end up with deep relationships and powerful accomplishments.
Sixth, Create and demonstrate value and your requirements will fall in place
Last week, N Chandrasekran the CEO of TCS was elevated to the position of Chairman of Tata Sons. This is a powerful achievement. And, value creation has been his hallmark all along.
Under his leadership, TCS has generated consolidated revenues of US $16.5 billion in 2015-16. With over 371,000 consultants, TCS has become the largest private sector employers in India with the highest retention rate in a globally competitive industry. It remains the most valuable company in India ended 2015-16 with a market capitalisation of over US $70 billion.
“N Chandrasekaran’s elevation as Tata Sons chairman is an outstanding choice,” says Anil D Ambani, chairman, Reliance Group. “Chandra, as he is fondly referred to, brings to the table an unparalleled track record of value creation and visionary leadership at TCS, the Kohinoor in the Tata crown.”
Some years ago we were bidding for a large national identity project. This project was one of its kinds and called for deep expertise in areas that we had. Anticipating that the bid document may have some conditions that may not give adequate weightage to the quality of the solution, we thought of reaching out to the client once the bid was released. However, we realised that it might be too late to get any changes in the bid at that time.
The client itself was looking for ideas on how to structure the bid and what kind of a solution would really meet their requirement and also be cost effective. So, we decided to come up with a demonstration of what a good solution in that space should look like using the best of technology available and did this on a very small pilot basis and shared it with the client.
The client was so impressed with what we demonstrated that they went ahead and came up with a bid document that provided a level playing field to all bidders and also gave due weightage to the quality of the solution.
This was something that we were seeking all along and we got it by thinking from the client’s perspective rather than just ours.
When you demonstrate quantum value, you may not even need to put forward your needs and requirements for the other person to meet. Instead, you could discover that your needs and requirements have been taken care of proactively.
You may have encountered the power of adding value in your own way. Perhaps the value addition you made enabled you to achieve your goals. Please feel free to share your experience.
About the Author:
Srinivasan is an independent consultant working in the area of strategy and technology interventions in the public sector domain. He has worked in companies like IBM and TCS and has over 30 years of experience spanning 24 countries.