The “NABC's” of Value Propositions

Value-creation is the process of developing new innovations. We discuss two of the first value-creation steps: identification of an important unmet opportunity and the development of a compelling value proposition. Important opportunities are potentially large and fast growing. They have a “white space” that allows a competitive advantage because there is currently little competition. The value proposition is the first deliverable of the value-creation process. It is composed of four main ingredients: the customer and market need (N), the approach for the offering and business model (A), the benefits per costs of the offering (B), and the competition (C). After the value proposition is developed, the additional steps required are summarized. Every enterprise function must have a value proposition. When value-propositions are understood and used throughout an enterprise, managers, teams, and organizations become customer focused and more efficient and effective at creating high-value innovations.