by Dennie Heye, Europe Chapter, Petroleum & Energy Resources Division
Information service departments are expected to show how they add value to the organization – a difficult challenge, but nonetheless an important topic. If you are not demonstrating value, the future of the department is at risk.
Value in this sense is perceived value by the customer, and this can differ from the ‘real’ added value as the producer added it. For instance, the costs of setting up a personalised information alert are quite low. But for a busy professional, this fine-tuned and highly personalised information delivery may be very valuable in terms of time savings, frustrations saved and opportunities created.
In a formula, you can express the perceived value as:
Quality x Service
Value = ——————–
Costs x Time
In this formula, one aims to bring quality and service to the highest level, while keeping costs and time investment on the lowest possible level. Quality and service in this formula are as perceived by the customer – as illustrated by the following quote from Peter Drucker:
“Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe…Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality.”
Facets of perceived value
In order to find out what the perceived value of your service is you can, for example, use a customer satisfaction survey, asking what element of the service or product provides the value for the customer. In this context, it is more than just providing the service; it also entails exceeding the customer’s expectations and being proactive.
From an information service point of view, the real value is making sure the right information is available to the right person at the right time. If possible, this should be achieved with little time and effort for the customer to get maximum value. Part of the perceived service is also the trust of the customer in the provider, as the information delivered has to be trustworthy if decisions are to be based on it.
Last, but not least, are the cost and time components the customer has to invest to acquire and use the service. This covers not just the financial costs but also the effort involved; think about filling out a complex form, for example.
If you work closely with customers, you can gain valuable insights into what they perceive as the value of information products and services – and the investment it is worth making in them. In particular, when a customer does not pick up a product or service, it is helpful to see how the balance between value and investment is perceived.
Dennie Heye is Global Knowledge Manager at Shell International. He is also a member of SLA’s Information Outlook Advisory Committee and the International Relations Chair for the Petroleum & Energy Resources Division.