[Page xxvii]More granular is how Value Creation can be increased in Customer service and in strategies to increase loyalty. And then, we come to the profit part on how to increase prices and Value to the company.

We then show how Value Creation can be used in education and how it is a more universal tool usable outside of business in society.

Lastly, the book helps the CEOs to drive their companies to a leadership role and to increase profits through Value Creation. Value Creation implementation steps are discussed.

The appendices have interesting articles on Value Creation, and more Value Creation ideas and definitions.

This thinking becomes more important because a CEO is forced into the new digital world of artificial intelligence (AI), unbridled gadgetry using biotech and bio instruments, the Internet of Things, more workers and unemployment, lesser/more dependency on the worker. The CEO has to think about spending power, inflation, currencies and payment means, definitions of geographies, markets and industries whirlpooling together into indiscernible continua, while social and government stakeholders will impact micro and macro marketplaces (micro meaning the individual, macro meaning everywhere). Bundle this with active, forceful, and destructive Customer reactions, better knowledge assessment, and anticipation with the half-life of new technologies reducing, and you can easily see that the CEO's life is not easy!

What does a CEO do to get ready for this new world?

First he has to realize that his role is to Create Value and balance this for all the stakeholders, while understanding that they are all interconnected. He has to lead by learning how to create this Value [Page xxix]in a fast moving world where his stakeholders are changing and are becoming more demanding. The CEO always knew this, but did not prioritize this role as the world had been slow moving and the demands from the employees, partners, Customers, society, and government had been less intense. Thus, he has to re-learn and change focus and direction to be the winner in the coming decades. This book helps him to do this, to consider options and show why and how to balance the seemingly conflicting (but actually complementary) pulls and pushes on him.

Management gurus urge CEOs to embrace these new paradigms. It just is not possible to become enlightened without taking the first few steps while grappling with competitive pressures, changing technological and product landscapes, growing employee and Customer demand, compulsion to perform for the short term, and so on. But what is important is to take the first baby steps toward the new paradigm, while wrestling with transforming existing thought processes.

This new thought process is Value Creation. It is not really a new thought process; it always existed, but it has been relegated to the back burner, and Value Creation continued as a normal course of doing business (and mainly for the investor or owner). Value Creation by those who could create meant going beyond what was expected from you in your job. People were not conscious; they were Creating Value or destroying Value. And therefore the effort was muted. By making Value Creation a mainstream activity, CEOs can then embark on changing for the future.

Value Creation is for society also,17 and we discuss its role in education and in society (examples include the Value of an address [giving digital addresses to people who are homeless or in slums and do not have a proper address], government).

[Page xxx]In a way, Narendra Modi, the prime minister of India, has embarked on changing India by talking about Creating Value for the underprivileged, the industry, the common man, the bureaucrats, and society at large.

But how is this Value Creation going to happen—not just by throwing money at the problem? It starts by building the self-esteem of the downtrodden or the citizen when he is harassed and bullied by the government (read income tax, read municipal corporation, read the courts, and so on). How do we get this person's self-esteem18 up? He has to feel good about himself and his environment. He has to feel adequate, important, and wanted.

And this, from the point of view of the CEO, is true of the front-line people and the other staff. How do we make them feel wanted and important? This book tells you how to build this self-esteem and get a feel-good factor for these people. This is the first step to Value Creation.

It is only people with self-esteem who can become aware of their environment and, more importantly, of their role in their own success and the success of those around them including the corporation. This is the first ABCD step (awareness, belonging, communicating and Creating Value, and not destroying Value). And it is only the aware who can Create Value. If you are not cognizant of (good and bad) things happening around you, you cannot effect change or want to change and, therefore, cannot improve or Create Value.

So this book tells you how to make your people Value Creators for their employees, Customers, partners, and society and how this contributes to the growth of your company and your success.

For society, we tell you the Value of the Values that you, the CEO, and your company stand for. Values include morals, ethics, lawfulness, sustainability, charity, goodness, conscious leadership, conscious capitalism, and culture.

We tell you how Values Create Value. We tell you how to Create Value for your Customers and how that Creates Value for you and your company.

[Page xxxi]This, then, is the company of the future.19 And this depends on you, the CEO. Mckinsey, citing AI gains, has shown how robots are replacing executives (it is happening as robots replace law clerks, pathologists, retail aisle placers, and petroleum geologists). My answer is that this will happen if the executive is not Creating Value! Even more, could Customers who Create Value for the company replace managers who are creating less Value? Humans decide what technology should do, and technology may decide what humans should do (or we hope should help humans do so). Thus, AI and technology may change the face of call center responses, the way we approach Customers and business.

The revolution has started with the release of the Journal of Creating Value20 and key management gurus agreeing that Customer Value is crucial for businesses.21 I (as have others) have delivered courses on Value Creation (such as one for engineers, and others for HR professionals, CFOs, front-end staff, IT, and so on).

To start, let us examine the Customer and the company of the future.

The Customer of the Future

The Customer, in the future, will perform more due diligence before buying, become more digital, look at more options, listen to others’ opinions and digital word of mouth, and have less time and desire to physically ‘browse’. He will want to browse and buy more on the net. He will be looking for confidence and reliability in the supplier. He will want interaction when and where he wants and how he wants. He will be better informed, more price-sensitive, and often will come to buy with his mind made up. Often, he will wish to interact with people who can change his behavior or the way he lives, buys, or thinks.

He will bypass brand for social media scores (brand equity is giving way to social media score equity!)

Imagine the Customer selfie and how it reflects his life and lifestyle. Marketers can look for the first time at the Customer's life through his eyes on Facebook, for example. The consumer is saying look at the world through my eyes.

Because of all this, the Customer will leave a trail that big data can and should pick up. While concerned about his privacy, he will allow companies to track him and please him because as they become knowledgeable about him and his needs, appreciative of his habits, availability, strengths, and weaknesses, they will become more relevant to his needs and to customize for him.

The opportunity and ability of companies to get their work done by Customers will increase. Thus, a car manufacturer can alert a Customer that his car is on the assembly line and the Customer can see it. Conversely, the Customer might want to know if his delivery is on time, and it can be tracked, like if his pizza is on its way and what the expected time of arrival (ETA) is. This will be true for the service person: where he is or whether he is carrying a part I need. This ability exists today but will become more universal, and follow-up by the company will become less and by the Customer more.

The Customer would like the delivery process to be different, where he can pick up purchases close to his home, rather than sitting and waiting for delivery. The convenience of the Customer [Page xxxiii]will become an important selling point, as will concern for his time, energy, and psychic needs.

The first thing that is bound to happen is that conventional selling will change and Customers will deal with people who can present them with product and service options that they want and when they want them (and help them buy and become their buying aides). They want something relevant and desirable to them at a particular point in time. Companies have to help Customers in the Customer decision journey. Thus, if camping, they may want location of good burger shacks or the right insect spray, or if in a mall, options and the best way to navigate to shirts (and stores, and other options).

Funnel systems of selling and time of sales are getting outmoded. Dynamic and iterative buying process on a 24×7 basis will become more prevalent. Which means sellers will need an adaptive and innovative selling method and thinking.

Conventional selling will become modified to being more relevant to the Customer (Customer relevance will become a selling point). Crowd selling to Customers will give way to focused selling of relevant items to those Customers looking to or thinking of buying (or should be thinking of buying).

In the physical world, an example of Customer relevance and crowd selling is like going to a fair and having hawkers selling curios, snacks, etc. Once the Customer seems attracted, one-to-one selling takes place. (The Customer's virtual buying guide will direct him to the desirable curios or snacks.)

This happens in traditional malls, particularly in the East (Thailand, Korea, India, etc.), where the sellers sit outside the shops, looking for interested Customers (though they do try to interest Customers, which sometimes becomes intrusive). Customer aggregations will reduce as marketers concentrate on being relevant and customized. The Customer no longer needs to go to crowded places where there is a variety of stores. The stores will come to him.

Thus, relevant, discrete, and unobtrusive selling to individuals will become more appropriate. This is how the e-selling mode will further develop.[Page xxxiv]

The buyer may also look for those sites that provide him with this buying (I am differentiating buying from selling) facility.

The Customer will start to look at sites/stores that give him options to explore and select, and to have different payment and credit options. He will want to be able to get to adaptive sites that will let him experience the product, as an example, a sofa and how it would look in the room; a car and its leg-room.

Ted Rubin, a digital media expert, talks about a hybrid store building that serves a community allowing a great digital and thereby a great Customer experience. He suggests a video that answers questions even before they are asked. I would say that the Customer wants to be able to see and play with the products, such as a laptop, TV, or a car, on the net to get a feel for it, just like he can peek into a book today. Or he wants to be able to see the physical features of an air conditioner or a refrigerator on the video and how these features work, and see how he can control the temperature, air swing, etc. Else he might want to feel the leg-room on a particular seat in a plane, or the best way to get onto a cruise ship to avoid lines. Google, for example, has some of these features and can alert Customers on the best route, least wait, or airline arrivals.

The Customer will want customized products (color, size, delivery and assembly method and timing, etc.). These will have profound impact on the manufacturing companies. This change has started but will become more universal. Flexible manufacturing and delivery will replace manufacture of scale, where scale used to be a competitive advantage.

Companies have to employ and use big data and social media to pinpoint the Customers’ needs and his location so as to be able to understand the Customer and service him. Companies have to be data-driven; also, they should be able to comprehend Customers and their needs, manage leads better, get involved, and integrate social media.

Sometimes, Customers may find it easier to engage with existing suppliers and get them to collaborate and solve their problems, co-create, or develop new products and services for them.[Page xxxv]

Accenture suggests that while Customers are better informed, all this can cause overload. Worse still, Accenture adds that they will face confounding web sites, huge call center wait times, and difficulty solving their problems no matter which channel they use. “It all adds up to increased Customer switching that has put an estimated $6.2 trillion [up from 4.9 trillion 5 years ago] in revenue opportunity in play globally.”22

Already Customers are available on (or they may have access to) the net. Perhaps, they will be hardwired, or their brain waves will be tapped (already there is talk of controlling your TV with brain waves).

The Customer could provide this (or capture and then supply as needed) to selected suppliers. Brain wave mapping will make him a more intelligent buyer, and the supplier who has such information from the Customer will become more effective. Perhaps the supplier will know before the desire is articulated what he needs to do. The Customer is already getting wired 24×7 through devices. Perhaps there will be some neural wiring allowing him to understand his needs better. This will change the buying and selling paradigm even further.

Will the Customer be able to tap into AI to articulate his needs, or evolve his thinking on what he wants? Will he be able to assess what he really wants not what he thinks he wants? And which company can help him?

Products will change beyond our imagination. For example, there will be different transportation systems, electric and solar flight pods, and liquid nitrogen engines. Will there be space travel, or time transfer or teleportation? Will science fiction become real, or can we make it real? (Science fiction in medicine and health care, for example, is becoming a reality.) These are real challenges in front of marketers. Products will change our thinking—the Customers’ and the companies’.

[Page xxxvi]Finally, while all of this may lead to less interaction, the Customer will expect companies to be truly H2H (Human to Human) as and when he wants.

The Company of the Future

As with Customers, there will be many different companies of the future!

The first challenge is to understand and perceive the Customer of the future. Should one be re-active or proactive? As the Customer becomes more dynamic, the management has to follow suit and become more adaptive. The strategies can no longer be static, they have to become iterative and vibrant, and change with the market. This changes the strategy paradigm, where we let the marketplace decide and change our direction, or we can change the direction of the marketplace by anticipating the Customer as his needs are developing, changing, and to capture this to be able to make the Customer want to buy from you (forget selling?).

An example of being proactive is to become a self-tuning organization.23 Companies such as Google, Netflix, Amazon, Microsoft, Apple, and Alibaba employ this to understand the Customers’ needs. They use their knowledge to deepen their interaction with their existing Customers to collaborate better, to offer them better solutions, products, or services which are thought out jointly with Customer or the understanding of the Customer.

The other central thought is about more self-tuning and aligning of Value co-creation, where firms will emulate Apple, AirBnB, and Trip Advisor. The idea is to convert Customers from just being transactional buyers to avid promoters of the brand while working together to create mutual Value, strategies, products, and refinements. This makes the Customer an active player, than [Page xxxvii]just a passive buyer, and excited about talking about the brand. (The brand score is giving way to the Customer score!) These companies can then access the Customer's networks (see section, Creating Value from Your Customer's Network, Chapter 3). We want Customers to go from being transactional, supportive, and promoters to be co-creators and feel like co-owners. Just see the apps that support Apple and Android.

This transforms the company into just supporting buying by Customers to making them partners. It gives companies better insight, faster knowledge of Customers, reduces costs, and increases self-tuning (flexibility). Thus, companies have to find such Customers and visualize through self-tuning where and how to operate, trace, follow, and gain partnership positions with the Customer. It is happening and will happen more. You will have to change your company's direction in this fashion.

Change is a strategic thought process and requires the 4As. The first three As are agility adaptation, and ambidextrous (see the Self-tuning Organization), and the fourth is ability of CEOs or able CEOs. Ambidextrous means a company has to be an exploiter (of Customer's preferences) and an explorer (offering things beyond what the Customer has thought, so that new preferences can appear) simultaneously.

Remembering the Customer's needs evolve depending on where he is and what he is thinking, what new products, apps, and services come his way, companies have to be relevant and collaborative and able to supply him what, where, and when he wants, and even before he knows that he wants.

Find the Customer, where he is, supply him with what he wants or make him want something right then and there. The Customer may be wired, and it is possible that his neural impulses could be tapped to provide what he really wants not what he thinks he wants. The Customer is partially wired through cell phone or internet watch, because his position is known through tracking of his actions, such as selfies and conversations with his friends, etc. Google already knows when I send a message to a friend suggesting a con call and puts it on my calendar, or my flight plans. See Doc Searls article in Appendix I[Page xxxviii]

Retail stores will have to be digital and physical (physi-digi24 versus digi-physi25). They will have to build a community that communicates with them. They will need to supply great H2H experience even though hidden in the net. Stores like Tesco are without walls (with online portals), selling non-traditional items like financial services, and allowing other companies to access their resources and programs.

Videos that allow Customers to interact, explore, understand, feel, become comfortable with, and want to buy will be developed and be self-tuning to the needs of the Customer.

Anticipatory service and products will become a norm and the Customer will have better, informed choices.

As companies change and focus toward the Customer, they will be forced to self-tune to the employees and their needs. Departments (will there be any? I doubt it) will have an H2H interaction with employees, sharing, co-creating, co-working/thinking, and collaborating together. The employees will be diverse and creative in different ways and companies will have to foster an atmosphere of creativity, constant change, adaptability, and agility.

Such employees could experiment, do market research in different ways to provide products to the Customer that are adapted to his needs.

Many thinkers suggest that offices should be in the cloud; not physically existing. People will get out of the box into a great big co-connected and innovative space, with freedom and flexibility. Intrapreneurs and intra-owners26 will be cultivated. They will work in an open source environment with few secrets.

Such thinkers feel that the concept of the CEO is dead, and managers and gatekeepers will disappear. This is simplistic, and managing complex, flexible, adaptive and agile companies will require different type of management systems, those which are more focused on Creating Value for the stakeholders. The rigid [Page xxxix]organograms and structures will disappear as internal competition and collaboration dictate different hierarchies.

I believe that the office of the cloud is clouded with digital thinking and does not represent the huge manufacturing and physical world. True, some multinational offices may become cloud-based because of necessity, but by and large the manufacturing company of the future (and other companies) will change less drastically. Manufacturing companies, railroads, airlines, and hotels will need people to run them. They will not get entirely robotized in 10 years (and someone will have to manufacture and program robots, unless robots become self-generating). Workers, employees, and physical locations will remain. Manufacturing will become more digitized or digitally driven (processes, quality, improvements, information, and so on).

What will change is that companies will shift to new products, fast introduction, short shelf life, and customized and flexible manufacturing so that assembly line products will be distinct. That is, every subsequent product will be different from the first one in consumer-based manufacturing. This has happened in furniture, where one line can produce a table, followed by an office chair with customized upholstery followed by a sofa. Inventory goes down and wait time for products reduces. Or they will go to smaller lines.

Even more interesting would be digi-physi using techniques like 3D printing to produce the same products in different part of the world after digitizing, transferring, and producing. Distributed manufacturing would make the world shrink and impact companies.

Certainly, for many mass products such as cement, fertilizers, salt, steel, aluminium, etc., conventional high-speed manufacturing and subsequent transportation, warehousing, and delivery will continue. Here, the biggest change will come from product development, like better crop nutrients, that can be delivered without wastage and without contaminating the environment. Quantities of crop nutrient will drastically reduce, changing the current manufacturing techniques. Agriculture will be more technical in seeds and products.[Page xl]

The major changes will come from big data in space, robotics and autonomous systems, synthetic biology, regenerative medicine, agri-sciences, advanced materials, and energy (including storage). Just the spending in manufacturing using the Internet of Things (Mckinsey study)27 might be as high as 1.2–3.7 trillion dollars in 10 years and all spending would be 4–11 trillion dollars.

The changes that will come will be in the selling, anticipating needs, iterative and adaptive selling, and production control and sequencing. Changes in shipping and delivery will happen. Delivery chains will move from a centralized system to a localized system of delivery. I think the idea of drones, drop boxes or dropping smaller products at a pick-up point, like current post offices where you are given a code to retrieve your product, will reduce costs. Your presence or waiting at home will disappear except for large products.28

[Page xli]Company thinking will become more Customerized (customized for individual Customer). Companies will become a hybrid structure, where they are accessible and approachable the way the Customer wants it. The rise of digital has given Customers many channels and avenues. It has given companies the same power, if they can use it in a self-tuning, intelligent way.

Companies will also become more society-centric, where their Values will Create Value for the Customer, employees, partners, and society.

Companies will have to understand that loyalty no longer is what they thought it was. Loyalty will have to be a collaborative, adaptive process between the company and the Customer. The company will have to be loyal to the Customer, too.

What I fear most with companies and employees led by digitized, canned programs, where their innovativeness will come from using known techniques and cookbooks for unknown applications, is that they will lose their ability to think of problems in a fundamental, common sense way and become followers of the “cloud,” without understanding the basics and the science behind what makes things happen.

The future will provide new ways of Creating Value for the Customer.[Page xlii]