It’s my belief that our society is hyper-focused on the bottom line and is simply in business to make money. I want to share with you a different way of thinking – a personal philosophy of mine. I believe that the creation of new value, rather than dollar signs, is what we should focus on in our work. When value is created, profit is the byproduct.
My focus is not on how much money I can earn; it’s on how my company can help solve problems for our customers and increase their value. I have always been dedicated to helping customers, employees and vendors be more successful. I encourage my employees to get involved in the community and to strive to reach their personal definition of success, in both their business and personal lives. I firmly believe that when a person focuses on developing their character, he or she increases their value, making them more beneficial to all.
By way of definition, the notion of “value-added” concerns enhancements added to a product or service before being offered to customers. Value-added refers to an additional feature of a product that moves beyond normal customer expectation, providing something extra with little or no added cost.
I have grown BEGNEAUD Manufacturing by reinvesting in the company through equipment acquisition and personnel training. At BEGNEAUD, employees contribute value to the company, which in turn provides value to our customers. I rely on employees to add new value through their ability to drive efficiencies into processes and transactional procedures. In exchange, employees receive more than just a paycheck and perks. They also increase their skill-base, have more opportunities for career development and hopefully enjoy greater happiness through job satisfaction.
We also add value through efficiency and quality and striving to sustain excellence in the services we provide our customers. In manufacturing for example, excellence could be the ability to modify existing processes to reduce machine setup time and the part’s runtime. Time saving through improved efficiencies is one value exchange between BEGNEAUD employees and customers.
Consistent part quality is another value-adding contribution to our customers. Once a given process is proven to be the most effective means of compliance with a customer’s specifications, it’s documented as a means of repeatability and performance measurement. Measurements are taken based on customer satisfaction, not profitability. Neither efficiency nor quality necessarily equate to dollars. Dollars are simply a unit of measurement used all too often in modern society.
In marketing, the extent a product is perceived to satisfy needs is measured by the customer’s willingness to pay. It depends more upon the perception of worth than on intrinsic value. In other words, value can be desirability or utility.
For example, when choosing a career, some of us find something we are passionate about and pursue that interest. Whether you’re a welder or a lawyer, you should view the services you have to offer as a value. As a representation of that value, we are most commonly paid with money. When money is used as a measurement of success, greed becomes a natural by-product. I’m not saying profit is bad. Profit is necessary to sustain a business; however, it’s not the reason for my being in business.
We must understand that economy is truly a value exchange, and greed hampers this exchange. It is imperative we step away from the current paradigm of: “It’s all about the money.” We need to embrace the meaning of value exchange to unify our global economy for the future of our children.
For me, another business imperative involving value-adding is the matter of corporate social responsibility and being a good corporate citizen. BEGNEAUD strives to align company activities with the environmental, economic and social needs of all stakeholders. An attempt is made to take into account the social, economic, and environmental impact of our operations to the community and larger society it operates in. I believe that concern for human rights, community development and employee welfare is a value addition that will naturally result in greater profitability and organizational sustainability.
Competitive advantage can be gained by appealing to the apparently growing ranks of socially and environmentally conscious customers and employees. I am proud of our progress, but there is so much more to be done.
Adding value to business endeavors is a new 21st Century concept, rarely considered during the 20th Century. Throughout the 1900s businessmen focused on the bottom line. What made money was what was endorsed and accepted.
However, as Don Begneaud explains, being in business in the modern era is not just about making money – there are many other variables that must be taken into consideration and regularly monitored to make business enterprises successful – and profitable.
Largely through exploratory processes of trial and error, many modern day businessmen have come to realize that there is a lot more involved in doing business than simply seeking financial gain. The business-as-usual approach has ceased to work in today’s business environment. In earlier articles we’ve discussed factors that drive new ways of doing business. For the purpose of this article, suffice it to say that there’s substantial research to show that businesses with a single-minded monetary focus do less well. Rather, the modern day requirement is to simultaneously pay attention to all the moving parts that comprise the business. (ref. Blair, ALL THE MOVING PARTS: ORGANIZATIONAL CHANGE MANAGEMENT).
The starting point is with the company’s employees. In today’s business environment, employees represent every company’s most valuable resource. It is through one’s employees that all business gets done. The success of employee business transactions is directly related to employees’ willingness to embrace company policies, understand business goals and direction and lend their talents in contribution to the company’s aims.
The greatest failing of modern times is demonstrated by business owners who overlook the importance of having the “business conversation” with employees. In my latest book, VALUE PLUS: EMPLOYEES AS VALUERS, I describe these business transactions in some detail. Let’s take a brief look at these, starting with the way things worked in the past as well as in the modern day.
In earlier times, employees expected to remain with one company for the duration of their working years. Industrial workers of the past were largely beholden to the employing company doing what they were told and when they were told to do it. Thus, they didn’t need to know much about how the business operated or even anything about the overall business strategy planning.
In the 1970s and 1980s, with a move away from the industrial worker and to the knowledge worker, a sea change was initiated for the business arena. With the advent of the knowledge worker, employment circumstances began to change rapidly. The knowledge worker is very different from earlier workers and is expected to make all sorts of decisions on behalf of the company – from what they are to do each day, to how and when they will do it. Where the industrial worker once put his brawn behind the company, knowledge workers are expected to put their brainpower to work in favor of company goals.
For this business transaction to work well, therefore, it is absolutely imperative for each employee to understand in great detail what the company stands for, what it is trying to accomplish, and where it is going – in other words, what are its mission and goals.
The responsibility for transmitting this information and of creating a valuing and valuable employee rests with owners and heads of companies. Employees start to work at a company in a relative state of ignorance about what the company is trying to accomplish. The extent to which the knowledge gaps can successfully be filled is the degree to which the employee will become an effective contributor – or, as we say, a valuing employee. Producing a contributing employee equates to producing a valuing employee – and to adding value to the firm. If companies intend to prevail in the 21st Century, these business conversations must be implemented, with full attention to outcomes and results.