Time-Cost-Quality = Value
Every business attempts to achieve the three elements of every product or service: Time, Cost, and Quality. It is difficult to be excellent at all three and still maintain profitability or secure growth. Because of this most companies focus on either 2 out of 3 or 1 out of 3 of the three elements to obtain profit and growth objectives.
Time represents how long it takes to provide the customer the product or service, which relies on the time it takes all prior processes that it takes to create/manufacture the product or service.
Cost represents the selling amount, the price of materials, and labor to make product or service possible.
Quality represents levels of customer service, product grade, aesthetics, authenticity, uniqueness, rarity, and experience.
Time + Cost + Quality = Value
Value will vary depending on each customer individual needs and wants.
Amazon is close to accomplishing all three elements with excellence in Time and Cost. Although Amazon has excellent customer service, the Quality suffers a little from independent 3rd party shipping companies whose values, mission, and vision are not aligned with Amazon’s.
Chik-Fil-a and Starbucks both rely on the Quality of customer service alone. Neither are cheap products, neither have the best products in their industry, and customers do not mind waiting in often long lines for the products.
It appears that when businesses reach an extreme high level of quality of customer service and experience that it creates a culture of dedicated and loyal customers returning NOT specifically for the product, but for that level of customer service and experience no matter the cost.
Some customers cannot afford or are just not willing to pay high costs for such products/services, so they deal with the lack of quality of customer service and experience to take advantage of the low costs.
Target has been able to stay in business despite Wal-Mart’s dominance in the market because they focus on what Wal-Mart does not offer, which is Quality. Not only Quality in customer service and experience, but in Quality of products as well. Some people are willing to pay more for increased Quality of overall shopping experience.
As a business, knowing your competition’s strengths and weaknesses as well what is the target audience that you product or service attracts is key. A strong analysis, strategy and planning equals success, no matter which of three elements you attempt to achieve.
These attributes can be applied to your personal life as well. Think of yourself as a business every now and then.
