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How Much Value Can You Add to a Doughnut?
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By Ziv Navoth

"No one cares, really, about how good you are. They care about how good they are going to be when you're done with them."

A few months ago I was invited to speak in front of 300 accountants. The topic of my speech was “Adding Value”.

I consider myself an expert on the subject of adding value, so I found it somewhat disturbing that as the deadline for writing my speech grew closer, I had no clue what I was going to talk about.

Accounting has been around for over 500 years, during which the profession has hardly changed. If we transported Luca Pacioli, the Italian mathematician who invented accounting, to today’s world, he would have felt very much at home working in any accounting firm.

And therein lay the profession’s problem: While the nature of business has changed tremendously over the years, the practice of accounting hasn’t. Accordingly, accountants find themselves spending less time in the boardroom and more time in the back room.

And we all know what happens to the back room. It gets offshored to India.

Three days before my speech I stumbled upon an article in the papers about Krispy Kreme, the doughnut manufacturer. The company was going through tough times and hired an accountant, Steven Cooper, to help sort out its problems.

I suddenly thought of an idea for my speech. Since one way of measuring what’s valuable to our customers is to take a look at how much money they’re willing to pay for it, why not look for the highest paid accountant in the world and see how he adds value to his customers?

What I found surprised even myself and turned out to be a great lesson on how you can add value, regardless of which profession you’re in.

I started by looking at the bottom of the accountancy food chain. If you’re a bookkeeper, you can charge your customers $400 a month.

If you’re an accountant, you can charge your customers $4,000 a month to keep their financial records in order.

And if you’re one of the Big Four accounting firms, you might even be able to get away with charging your customers $40,000 a month.

But if you’re Steven Cooper, you can charge your customers $400,000 a month.

You might say “$400,000 a month - that’s ridiculous!” You might say $400,000 a month?! No accountant can charge a company $400,000 a month!”

You might say that and you’d be right. But then Steven Cooper isn’t just an accountant, he’s a turnaround artist.

True, Cooper is a member of the American Institute of Certified Public Accountants. But that’s about as much as he has in common with most of his colleagues in the profession. Because while most accountants focus on analyzing financial events that have already happened, Cooper focuses on the future, helping companies such as energy trader Enron and doughnut maker Krispy Kreme untangle past mistakes, restructure themselves and stay in business.

But how does Steven Cooper deliver so much value? More importantly, what can you do to add more value to your customers?

1. Focus on outcomes, not activities. The people who hire Cooper to turnaround their companies don’t count how many people are involved and how many hours they spend at the office. They don’t care whether Cooper uses workshops, seminars, one-to-one meetings or strategy retreats. They only care about one thing: getting better.

Take a look at your company’s website. Go through your marketing collateral. How much of it focuses on activities, tools and techniques and how much of it focuses on the business outcomes you provide your customers? Customers don’t hire you (or your products) because of your methodology. They don’t hire you because of your technique. They hire you because of only one reason: to improve their performance. If you can do that better than anyone else, you can charge more than anyone else.

2. Have the courage to be different. Cooper might be an accountant, but he sure doesn’t call himself one. All accountants have similar training. All of them pass the same exams. So why are some paid 100 times more than others? Simple – they refuse to be like everyone else. They refuse to be defined by their profession and by their title. They refuse to do what accountants are “supposed to do”.

If you want to be paid 100 times more than what other people in your profession get paid, there’s only one way to do it – by being remarkably different. And the only way to be different (and get paid for it), is to add tremendous value to your customers. If you can’t call yourself the “turnaround artist” of your profession, then there’s no reason anyone should pay you more than the other guy.

3. Learn how to listen. Adding value to your customers requires the ability to listen to the them, understand what they want and figure out what they need. As Alan Weiss, the “Million Dollar Consultant” likes to say: “No one cares, really, about how good you are. They care about how good they are going to be when you’re done with them.”

If you can move from seeing the world from the perspective of your products and services to the perspective of your customer, you can add more value than your competitors, and charge your customers accordingly.

So how do you explain all of this to 300 accountants? You tell them about a colleague who found a way to make 100 times more than his peers and you tell them about Harley Davidson, the motorcycle manufacture which doesn’t simply sell motorcycles. “What we sell,” says Harley, “is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him.”



About Ziv

Ziv Navoth helps organizations improve their performance by creating a unique and valuable position in the marketplace. He is the Managing Director of Verve! (www.verve.nu) and can be reached at ziv@verve.nu.

Copyright 2006, Ziv Navoth. Feel free to print, quote, or forward, so long as you credit me.

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