Leveraging the Elements of the Value Web. The following graphic from The Business Value Web portrays the elements of value.
Focusing on the value web encourages leadership to deconstruct sequential processes and enhance value at all stages of relationships and services. Value has limitless potential. Productivity enhancement, innovation, process reinvention, and creative combination of these can always be used to enhance or even radically alter the value proposition that universities and professional schools offer to students and other stakeholders.
The latent value embedded in a university’s assets can be a powerful driver of strategic differentiation and growth, if it can be mobilized. The challenge to leadership is to marshal new resources and unleash the latent power of existing assets, combining these actions in pursuit of a unifying statement of strategic intent. Thinking in terms of the value web can enable extraordinary leveraging of resources, relationships, and innovations.
Focusing on value emphasizes imagination rather than merely adding additional resources to existing programs and practices. Instead of relying on simple addition, value maximization during tough times involves identifying, leveraging, repurposing, reusing, and creating new value combinations. It also involves creating ambitious stretch goals to stretch the imagination of stakeholders and to warrant new investments of resources.
Avoiding the Value Gap. Many colleges and universities are teetering on the brink of a “value gap” vis-à-vis their publics, a gap created by five factors:
• Misalignment between institutional purposes and the purposes of individual stakeholders, workforce needs, and public expectations. Most publics believe a realignment is necessary for many institutions.
• Placing power in the hands of autonomous professionals who can effectively veto attempts to realign individual, departmental, colleges, and institutional activities. This may be the single greatest barrier to innovation and will be discussed in a blog later this week.
• Agile deployment of resources is a core capability of tomorrow's winning institutions. Today by contrast there are widespread difficulties in mobilizing, leveraging, and repurposing the value that resides in the resources of colleges and universities. Most institutional resources are unavailable for agile use because they are fully booked through existing ways of doing things. More on this in tomorrow’s blog.
• Reductions in institutional offerings and disappearing slack resources in the face of financial hardship. The reductions and cutbacks caused by the recent recession have devoured any slack resources that remained and further reduced services to stakeholders, especially in places like California.
• Increasing relative costs, escalating debt burdens, and decline in family/learner resources, post-recession. Recent dramatic rises in tuition cost and cutbacks in colleges and university offerings create the potential for an even greater perceived value gap in the future, which colleges and universities must act decisively to avoid. Closing the perception of a value gap will require continuous efforts to align with stakeholder needs, improve outcomes and experiences, and control/reduce costs.
The tension/balance between outcomes, experiences, and costs must be a continuing issue for colleges and universities that hope to enjoy the confidence of students, parents, and the American public. Focusing on value will enable institutional leadership to assure they deliver on that promise.
Maximizing Value Through Efficiency, Forgetting the Past, and Creating the Future. Tomorrow’s blog will explore the principles espoused by Dr.Vijay Govindarajan, expert on innovation at the Amos Tuck School of Business at Dartmouth University. Dr. Govindarajan spins a “three box” metaphor for the strategy needed during coping with recessionary times:
• Box 1: Improving the efficiency of today’s businesses;
• Box 2: Forgetting the past – selectively identifying what concepts and folk wisdoms do we need to move beyond in order to have a prosperous future; and
• Box 3: Creating new lines of business that are the enterprise’s future.