In part 1 of this 2 part article we saw that goods-dominant logic is like driving a performance car but only using 1st gear
Here we look at how to access the other gears by evolving our view of the world from a goods-centric view that has total focus on exchanging value at a one-off sales point. To a service centric view
Such a service-dominant logic, as it is called, helps really explain how the world works...
...and accelerates our innovation thinking
Cash is everywhere - but what role does it have as we try and look at the economy as service-exchange based?
This is a preliminary view, where I look at cash rather than as a proxy for value, as being service tokens, which supports:
Such a view still allows us to observe common aspects of cash (the desire to acquire as much as possible).
And allows us to maintain our improved view of value - relating to progress being made. In addition to service-service continuum and other behavioural quirks we see.
A value proposition details how the offer will help a beneficiary make progress.
I've defined this as the proposed value (whereas realised value is the amount of value co-created)
We can use a formula way to describe a value proposition:
Value - it's more than the price someone is prepared to pay
It is the proposal to help a beneficiary make functional and/or non-functional progress in some aspect of their life. And it is the amount of progress made in use (co-creation of value).
That we measure value today by price paid and/or volume sold is a result of our product-dominant logic view of the world. It turns out, these are proxies we end up using as we are not relational enough. Something service-dominant logic opens our eyes up to.
Need a way to discover new concepts for your service?
Blue Ocean Strategy contains a few tools that give a great way to look at and discover New Service Concepts (one of five dimension in our services innovation model).
We take Gallouj & Weinstein's idea that a service is a matrix of four sets of characteristics. And say those characteristics are the attributes in a Blue Ocean Canvas. Then, using the Blue Ocean Four Actions Framework we can ideate service concepts by either raising, reducing, creating or eliminating characteristics.
The resulting new service concepts nicely adhere back to Gallouj & Weinstein's categorisation of service innovations: radical, improvement, incremental, ad-hoc, recombinative (architectural) and formalisation
So, you have an idea for a service innovation, how can you best describe the impact of it on your organisation?
We find that the extension to den Hertog's service innovation model we have made is a great tool for this
(and when used in combination with the Lean Canvas Model, we get a great insight into the value
How do we find/discover new service innovations?
If we have just a product, then we can look to service-ise that
If we currently have a service, we can use our extended version of den Hertog's model to seek innovations. These could improve the service concept, the service delivery (internal, new partners, new systems etc) or the client interface. They could be based on technology and/or data
