Value vs Relationship

“Recognize that today's customers are increasingly buying on value, not on relationship.”

This is quote from the book The Five Most Important Questions You Will Ever Ask About Your Organization by Peter Drucker with Jim Collins, Phillip Kotler, James Kouzes, Judith Rodin, V. Kasturi Rangan, and Frances Hasselbein.

While I thought much of the book was really good (it's hard to not find good from such a group of authors), this statement was worth sharing. The responses show a great deal of emotion and has brought further dialog...
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From: John Bentham
Ultimately, almost all purchased are based on value:

The buyer either values the "relationship" and won't mind paying more for something he can get for less somewhere else, or...

The buyer feels as if the product he's purchasing is a commodity and shops on price, thinking the service that comes with the product is the same anywhere.

Our challenge is to "add value" to the loan product such that the customer will value the relationship more than the purchased product.
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From: Joe McCubbin
I think above all it comes back to "Trust". The true Value of the Relationship is the Trust, thus V + R = T. Joe
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From: Mark Kelly

Danny,

I was trying to be humorous, but understand now that you were seeking serious responses. If I may readdress the question that you posed:

Value can be created on a transaction; a service rendered, or even something as simple as giving a stranger directions when they pull up in front of a store as you walk out – they’re lost and looking for help. You were “valuable” (aka “creating value”) for that stranger by helping him/her find their way to their destination. One could choose to pass it off as “just being nice”, but the fact is that you gave value, however insignificant it might seem.

Relationships however require an investment. Whether a professional or personal relationship, it takes time to build a relationship. Sure, you can give “instant gratification” to someone in a professional capacity in our business (say .25% off on their next lock – which also could be called “value” since that price break was of value to the LO), but did a relationship just spring forth? The opportunity to begin to BUILD a relationship was created, but it’s going to take time……and continued investment on both parties part…….to actually turn that one incident into a significant relationship.

To me, a relationship that is built between individuals (personal) or professionally (whether between two companies……an individual and a company……..employee and employer, to name a few) all have value built in over time. The value of shared experiences, goals met, transferred trust – these are some of the hallmarks of a “valued” relationship. If either party in the relationship begins to no longer perceive value being added or the value is eroding, that relationship will begin to suffer as well and oftentimes results in one party seeking “value” elsewhere.

Value and relationship share an interdependent existence in my opinion. In the short and long-term, it takes a mixture of both to create a powerful combination of both over time.
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From: Bryon Cunningham
Value is much bigger than price or service. Value is different from customer to customer for some it may be mortgage training for others it may be a wakeboard lesson and for others it may be an invite to a bible study and yes we must provide a certain price and a certain level of service. The key is relationships. Get to know the customer and provide them something extra, something they don't expect. Every customer has different needs and we have to identify and determine if we can fulfill those needs using our core values for direction.

If I stop at a convenience store for gas I have knowledge of what type of service to expect but if while getting gas someone from the store comes out and cleans my car windows I would call that value.

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From: Christy Meaux
I think it depends on how you define Value...

Is it strictly price driven, or is it the value we create when serving our clients by meeting their needs, thus having the relationship be a "result" of the value in service?
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From: Melinda Truitt

I'm not sure I fully agree with that, I think there needs to both :-)
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From: Mark Kelly
What??? Just last week, they were buying on relationships.........now it's back to value?
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Other comments/dialog?