NDIS: breaking down the jargon series: value propositions, niches and segments. 

becomingchange blog by DAVID PULS.  Email here.

When changing business models from block funding to the user pays NDIS model, myself and a bunch of other consultants have said to clients words like “look for your niche”, “what’s your client segment” or “how do you create value”?

As consultants we can default to the business jargon. Many of you haven’t had the jargon as part of your work or study life – which is great because it makes me think about what I’m saying and how I’m saying it. We have ways of making the simple seem complex, but we don’t want that culture in our organisations or with our clients.

Creating a value proposition that differentiates your niche service from others in order to reach your customer segment … needs simplification.  Let’s instead break things down into simple underlying questions, that have the same result.

  1. What problems do my clients have?
  2. Which of those problems am I solving for them?
  3. Of the problems that I solve, which of those am I solving in a unique way?
  4. Of the problems that I solve, which of those am I the best at solving?

That seems much simpler.

When we help someone solve a problem, we create value for them.  A simple example: I need a coffee in the morning. There’s a few ways I can solve that problem, but the one that solves it best for me is the local cafe. It’s convenient because I can take it away. It tastes better than me making it. It’s a reasonable coffee price. I think the $4 is good value, so that value proposition appeals to me.

That’s the easy bit.

But why this cafe and not the other two on the corner, or one of the seven that I pass going to work? Or better still, why not the two on my street that are closer? Well, where I go they know my name, the coffee is never bitter, they play a bit of early morning jazz and don’t blast me with dance music ( no one needs that at 730am).

But on days that I crave a muffin I go further down the road because when my problem is a combined coffee/muffin problem the place down the road has a better value proposition for me.

Stay with me here…

In fact I’m writing this on a property in the Huon in Tasmania (looking after a friend’s chickens) and the nearest cafe is a 20 minute drive away. Now the best value proposition for me is making my own on a stovetop (and not the coffee machine that I can’t work).

What do we learn from my coffee preferences that helps you strategically with the NDIS?

First, you can’t be all things to me.  Not even with the service you provide.  When you think of the area that you specialise in, your niche, you might think “coffee”.  Or you could be even more specialised and say “friendly great tasting coffee with jazz music”. So the second thing we learn is that a niche can be a very narrow thing.  If you think your niche is, say, “transport”, you may have more thinking to do.

This is a very new way of thinking when block funding encouraged you to do one thing broadly for pretty much anyone. For example in the homelessness area the still very recent “going home, staying home” reforms required all service providers to be able to service any client. A move away from specialisation in, say, domestic violence or LGBTQI.  So we’re used to being asked to do more for everyone rather than specialise.

And customer segment?  That’s kind of the flip side to niche. Your customer segment is the segment of the population who have the same problem, that you can solve.  The more complex you define the problem, the smaller the niche you provide to.

What does taking away the jargon do?  I think when we drop the jargon we can focus on the underlying questions.  In a way the jargon acts as a barrier – we hear the jargon and stop there.

 

So defining value and finding a niche is all about working out what you do best, that solves problem for people in a way that is unique.  Uniqueness is usually either through commodification and price leadership, differentiation…. and we’ll unpack THAT jargon next time.

Is this helpful?  I’d love to know what you think.

David Puls, 0412126006, davidpuls@becomingchange.com.au

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