I had animated conversations with an attorney and a CPA about the difference between standards and value. Every company, including all professional services, must have standards. These same companies and professionals can choose what value to provide on top of the standards.
Let’s define these components and illustrate how they work together.
Standards for companies and professional services firms are the behaviors and benefits that make your company viable and competitive for your desired buyers. They include adherence to industry standards and regulations.
For example, CPAs have to abide by generally accepted accounting practices and ethics standards. They are likely to also include some kind of standard related to timing. If a CPA firm can’t or doesn’t care about meeting IRS deadlines, that would be below standard.
Attorneys have codes of conduct, ethics, and regulations as well. Adhering to them is the standard delivered to every client. Just as the CPA has to adhere to IRS deadlines, so do attorneys have to adhere to court deadlines of various kinds.
Standards are the basics, the minimum or the least that is required to deserve to be in business. I also believe that honesty, respect, competence, and subject matter knowledge are standards every company should be built upon.
Value is what a company offers to its buyers beyond or in addition to their standards. These vary from a small amount to extreme high value. They can be priced in many ways. Not all buyers will want them, so you should only make them available to those buyers who will pay for them. Some buyers will want them but be unwilling to pay for them. If you give them away for free you lose money. (See the GO Curve below which illustrates offerings aligned with buyer segments.)
Here are the top 5 examples of value you can add to your standards:
- Higher quality
- Access to scarce resources
- Status builders
- Your advanced thinking
Convenience. If it is harder or more expensive to provide additional levels of convenience, you can charge for increasing levels of convenience in premium offerings. An HVAC company can offer one-hour service time frames to its premium members who pay for the privilege. Non-members get 4 hour windows for service.
Professional services firms such as CPAs, lawyers, architects, designers, consultants and others can offer their services for an entry level fee. The services meets their standards and is delivered in a non-rush time-frame. If a buyer wants something in half the time, the cost is more.
The standards aren’t less, the convenience is more.
Higher Quality. Standards include standard quality in design, materials, customer service and longevity or usefulness. Higher quality means you use advanced design thinking, higher quality materials, extraordinary customer service and timelessness.
Every company will find opportunities for higher quality when they look for them.
I do not work with companies, nor do I advocate to anyone, that quality should be inferior in order to make a bit more money.
Don’t skimp on quality for your standard offerings, add quality to build up value.
Access to scarce resources. Not all resources are available in the same quantities. Some are especially limited. One in particular is time or availability. The busy, in-demand person cannot spend the same amount of time with everyone. Those who buy the standard offerings get a standard amount of access. Those who buy higher value offerings enjoy more access. This continues up until you have the very best buyers having unlimited access. What’s great about those buyers is that they understand scarcity and will only ask for access in times of true need or importance. Other examples of limited access are spaces, like deluxe hotel rooms, and performances with a limited run.
Add access to build up value.
Status builders. Many successful people like to be known as associates of other highly successful people. There’s a sense that being part of the inner circle of someone with great status confers similar status to the client. It is priceless to be able to say you’ve done something with another in-demand person. You gain status from your associations. That is worth paying for.
Another kind of status derives from the reputation of the product. It is like buying a Bentley rather than a Ford. The Ford gets you where you want to go. The Bentley helps you feel you’ve arrived.
Build your own status, share it with others who want more value.
Your advanced thinking. Standards include typical norms and best practices. Be sure your standards meet those minimums. When you begin to improve and innovate and develop a track record of stunning success, you’ve demonstrated your advanced thinking.
Create offerings based on your most advanced thinking for those who value them.
Some buyers are perfectly content with your standard offerings and you should deliver to your standards. Deliver on your promises to them. But don’t deliver more.
Save your extra efforts for those who value them enough to pay for them. You can’t feel guilty about this. The goal is to have a large percentage of buyers who do value your high-end offerings. All you have to do is look around to see examples of publicly available goods and services that are stratified by cost and prestige.
You can do the same with your company’s offerings. Certainly set standards and live up to them. Also just as certainly, promise higher value from other offerings, deliver that value and maximize revenue.
Don’t grow it alone!
Setting standards and building value on top is one of the hardest efforts business owners and executives face. You feel there are ethical concerns; marketing challenges; and puzzlement over just what are standards and what is higher value.