Value is Interaction-Based
Although it is true that understanding the ways a product can create value is complex, it is absolutely not "fuzzy". Understanding a product's value simply requires one to understand how value comes about in the first place.
The value anyone receives from a product must, by definition, stem from that person's interactions with the product. If you don't use, touch or interact with a product in some way, it has no value to you at all. So, from a product developer's standpoint, each product interaction presents a design opportunity to create more or less product value.
Each product interaction can bring value in four ways.
Obviously, a product interaction that doesn't do what it is supposed to do is a failure. But, human values go far beyond mere functionality. A product interaction that requires the strength of a weight lifter and three hands to perform is far less valuable than one that can be performed by a ninety-three pound office clerk. One that is intuitively obvious to perform is far more valuable than one that is extremely difficult to learn or remember. And, one that makes you look like a bumbling idiot in front of your family, co-workers, or customers is far less valuable than one that makes you look like a competent professional.
The formal PVMsm model notes what people will value in each of these four categories for each product interaction. In a macro sense, PVM seeks out and organizes the many different interactions that stakeholders have with a product, recording what constitutes excellent or poor value (in each of the four ways described above). This knowledge base is compiled in PVM's first phase, Stakeholder Research. The knowledge base then forms a solid foundation for both discovering and evaluating valuable design solutions.
Anyone who interacts with a product has a stake in the value and success of that product. PVM calls the different groups of people who interact with a product "stakeholders".
A best of class product will "work well" for all stakeholders. Certainly, it will work well for customers. But it will also work well for other stakeholders, like distributors, retailers, internal manufacturing, vendors, service groups, key alliance partners, and so on.
On the other hand, a product can work wonderfully for one stakeholder group, but still suffer in the marketplace because it works poorly for another stakeholder group. The best example of this phenomenon is a product that is terrific from the customers' view, but is so troublesome for retailers to deal with that it gets zero shelf space.
Consideration of all stakeholders and all interactions in the value creation process is a major differentiation point between PVM and QFD. First, PVM recognizes the need to create value for all stakeholders, while QFD's Voice of the Customer focuses on only one stakeholder group. Second, PVM doesn't prioritize stakeholder interactions and related needs.
Many product development systems advise prioritization of product requirements in the name of efficiency. They are dead wrong. By definition, prioritizing requirements limits the level of breakthrough results you can achieve by effectively closing your eyes to those needs. Also, in most cases, prioritizing needs automatically reduces the size of the potential market you can reach. If you ignore a stakeholder group's needs, you can't expect them to buy from you! Ignoring a group that constitutes 3% of the market can automatically reduce your achievable market share by 3 points.
PVM provides a much better approach. Don't prioritize needs before you've even had a chance to see if you can meet them. Manage features instead. By doing that you give your team the greatest freedom to come up with innovative solutions that meet many of those needs you might have thrown out - and all at little or no cost. We've seen this happen time and time again. How? One elegantly designed feature can satisfy multiple needs, including some of those so called "low priority" needs. So, you pick up what would have been "throwaways" for free. And, you retain fiscal control. After you've done your innovation, you are free to pull certain features out of a product concept (perhaps to accommodate the realities of a constrained engineering budget), re-score the new de-featured concept's benchmark scores and see the expected effect on market performance. In fact, you can run the equivalent of sensitivity analysis on various features and optimize the selected feature set using PVM's marketplace predictions.
The point is that with the PVM process you dont leave anything on the table without a documented effort to first create value and, if necessary, a fully informed management decision to give it up.
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