Value-through-progress

Dr. Adam Tacy PhD, MBA avatar
What we’re thinking

We’re breaking free of the historical view of value.

Finally, if progress is hampered or not as expected, we might experience value destruction.

editing from here down

VALUE-THROUGH-PROGRESS

We need to evolve our thinking around value again to answer the question what does value mean.

value-through-progress: a view of value creation that sees value as being increasingly created as progress is made. Though it may not be realised until progress completes

What’s the alternative then? Well, I would argue that value is not embedded it outputs/results. Rather, it emerges from making progress.

progress: moving over time to a more desirable state

how it works

Let’s say you want to achieve something – hanging up a picture, moving location, learning a language, etc. These are some aspects of progress that you want to make; which we call progress sought.

Before you start making progress no value has been created. You haven’t achieved what you wanted. When you reach your more desirable state, you’ve achieved what you wanted, and so maximum possible value has been created. If we agree with those two points, then value must have incrementally emerged as you made progress. We call this value-through-progress.

This emerged value doesn’t need to emerge linearly with time. But it does need to be recognised by the seeker for it to have any meaning – a concept similar to revenue recognition in accounting. Value recognition allows us to answer the question how valuable is it to a seeker to reach 80km of a 100km journey. The answer isit depends on their value recognition.

value-in-useA view of value creation that sees value being increasingly co-created during a progress attempt as a progress seeker engages a progress proposition. Though value may not be recognised (accounting term) until progress completes.

From this concept of progress, we discover the true definition of value.

Maximum value is achieved when the progress sought is reached. If no progress has been made, then no value has been created. Value, therefore, emerges from the act of making progress — a concept we can describe as “value-through-progress”. In this way, it is a lagging indicator of progress.

Although we need to draw a distinction between value that emerges as progress is made and value that means something for the progress seeker. That is the process of value recognition.

Progress becomes a joint endeavour when we engage a proposition. Value still emerges through progress, and still needs to be recognised by a seeker; nothing has changed. Though in the literature we tend to say it is co-created through value-in-use to emphasise this joint nature. We also may observe value co-destruction.

  • Value emerges from making progress: value-through-progress
  • Value creation and value recognition are separate judgements
  • Reaching progress sought creates maximum value for a seeker.
  • Progress helper’s judge the progress potential of their propositions (the state they believe they can help a seeker reach; we call that: progress offered)
  • Progress seeker’s judge their progress potential (the state they they believe they can reach). If too low on their own, they judge progress potential when using a specific proposition.
  • Progress made with a proposition is a joint endeavour: value-in-use and value co-creation
  • Progress seekers repeatedly judge progress reached (where they have got to by a certain point in time) and remaining progress potential (where they believe they can reach) during progress attempts
  • Progress helpers may also judge progress reached and potential before and during an attempt with a particular seeker (less so, or not at all, the closer to enabling proposition end of proposition continuum)
  • Hindering progress can lead to value co-destruction

Buckle up, understanding value is complex, but ultimately, rewarding!.

In the progress economy we see value as being incrementally created as the seeker makes progress. The individual progress-making activities are where value emerges from resources through resource integration. This is value-through-progress. And marks a different perspective on value than the traditional value-in-exchange view (which sees manufacturers embedding value and exchanging for cash at a point of sale).

Each move towards a seeker’s progress sought results in more value emerging . This is how we get from zero value at progress origin to maximum value created by progress sought.

When engaging a proposition, progress is a joint endeavour between helper and seeker. This means value is now co-created towards progress offered. For various reasons, progress offered by a progress proposition may be less than progress sought. But a seeker accepts that if they decide to engage the proposition.

We now observe value creation as value-in-use. Which is a special form of value-through-progress reflecting the joint nature of progressing and resultant value co-creation.

value-in-usea view of value creation that sees value being increasingly co-created during a progress attempt as a progress seeker engages a progress proposition. Though it may not be realised until progress completes.

What do we mean by “Though it may not be realised until progress completes” in both definitions? It’s about when value is recognised by the seeker.

an improvement: service forward logics

To address these, we need to think differently about value. That means thinking in terms of value-in-use and value co-creation from

a continued improvement: value emerges from progress

What about value in the progress economy? Well, we’ll discover that value emerges from judgements of progress (moving over time to a more desirable state). The following judgements are made, repeatedly, at various points in the progress attempt (see the engagement decision process):

  • How much progress has been made up to this moment in time?
  • How much more progress can be made from this moment in time?
  • Are the six progress hurdles sufficiently low enough to continue?

And what we call value emerges from those judgements. Have i made enough progress compared to my expectations? If it worth me continuing? Is the other party hindering progress? And so on. Both parties make these judgements. Though it is predominantly the seekers judgements that determine if progress attempt continues.

the implications 

Value, as a measure/comparator, is no longer concrete thing. It is now a feeling. Something that is phenomenologically and uniquely determined by each seeker. And this should promotes helpers to be more relational in interactions to understand and adjust their offerings to help seekers make progress.

It also means we have to rethink the place of price and money. For example, as Kowalkowski informs us, “price becomes part of the value proposition”. We’ll leave the topic of money for another article (exploring its role as a service credit mechanism enabling indirect exchange).

Finally, thinking in tends of value emerging from judgements of progress leads us neatly to a surprisingly simple and actionable definition of innovation. Based on increasing progress made and/or reducing the six progress hurdles.

Lets explore value in more detail, starting with how we typically see value today.

Now we start to see a world where inseparability is reduced and involvement should be encourage. Which leads to a world where customisation is the norm (althougha not an absolute necessity).

This naturally leads to a view where discussing value before and after the point of sales becomes natural. And that means we remove the singular point of exchange.

Value starts being something that is created in use or in context (value-in-use). And we’re co-creating value.

But we don’t really define what value means in these service-dominant logics. To some extent we keep the word since it makes it easier to contact back with value-in-exchange and where value directly related to price. But in our value-in- use view, it is no longer enumerable based on price since we don’t have value-in-exchange. But how do we choose to use one service over another? What does it mean to say I give up with this service because it’s not creating enough value?

Which brings us to the progress economy thinking.

value in the progress economy

What about value in the progress economy? Well, we’re all about progress:

progress: moving over time to a more desirable state

Seekers are seeking it, helpers are offering it, and when a seeker engages a helper’s progress proposition there’s a joint attempt to make it. Therefore there’s three factors related to any progress proposition:

  • How much progress could be made (progress potential)?
  • How much progress has been made (progress achieved)?
  • How low are the 6 hurdles to progress?

And the engagement decision process tells us a progress seeker and helper repeatedly judge, uniquely and phenomenologically, these. Once before engaging a proposition. And then repeatedly; most likely at the end of each activity in the series of progress making activities.

It is from those judgements that what we might call value emerges. Although we might be tempted to debate if value is the right word, let’s stick to convention.

Now we say there is value-in-use because progress is made by carrying out the series of progress-making activities. Each activity increases amount of progress (value created). And as we make progress together, we say there is value co-creation. However, either party may impede progress being made, resulting in value co-destruction.

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