Are solutions the solution to adding customer value?

Philip Dover (Babson College, Mass) started his talk by sharing data that clearly shows that businesses perceive that "solutions" are crucial to business success. But what is a solution? There are as many definitions as claimants. Dover offered a definition developed by ITSMA, and then described a solutions hierarchy which ranges from general capability through to customer-specific solutions (which is where considerable added value occurs). He went on to acknowledge that it is very difficult for a company to make the transformation from a product-oriented company to a solutions-oriented company.

Dover and ITMSA have identified several key elements that must be addressed when companies wish to become solutions-oriented:
  • The organisation must redesigned, to allocate P&L responsibility at the business unit level, appoint a "solutions Tsar", and align effort with business partners
  • Marketing must be redefined—to events and sales literature, to a deep understanding of customer needs and the creation of value propositions
  • Move from a [standalone] product development cycle to an integrated portfolio approach (founded on an intentional solutions development process)
  • Change the measurement metrics from revenue and profit, to lifetime value of the customer
  • Change the sole of the salesperson from a single operative, to that of a coordinator ("acts like a quarterback").

Given the commercial upside of embracing a solutions-oriented approach, should all businesses strive to adopt such an orientation? Dover's is "no". He suggested three elements must be present as pre-requisites before attempting to adopt a solutions orientation—being a large (high $$) customer and a complex requirement and relatively new technology.