Saturday, December 10, 2011
Michael Hugos, author of Business Agility, writes in the current issue of CIO that when he worked for a company that supplied Starbucks with paper cups they were not the lowest-cost provider. But they "found 20 things we could do to make our cups easier to order, easier to use, easier to pay for and easier to plan and budget for." When they kept enhancing these as Starbucks's business needs changed they "provided a compelling reason to buy from us. Because we delivered more value than Starbucks could have gotten from a plain, low-priced paper cup, and because we were agile and responsive to the evolving needs of a high-value customer, we earned 2 percent more than the market price on our cups. I call this extra profit the 'agility dividend.'” This is how CIOs have to think to truly add value to the systems they manage.