Evolution

MADE BY:PRAKHAR PORWALDELTA MODEL EvolutionThe Delta Model was developed by Dean & Company co-founder Dean Wilde, and Arnoldo Hax of the MIT/Sloan School of Management, to help managers formulate and implement effective corporate and business strategies.What is delta model:Delta modelis a customer-based approach to strategic management. Compared to a philosophical focus on the characteristics of a product (product economics), themodelis based on customer economics. The customer centricmodelwas developed by Dean Wilde and Arnoldo Hax.The Delta Model is a new strategic approach focused on building long-term strategic relationships and creating value through "bonding" with customers

1. Best Product : In this way, the authors concentrate two of porter's generic strategies: the low cost and differentiation;both are centered on the product.Hax and wilde are the best product position as unsustainable in the long run and tending to the commoditization of the offer.

2. Total Customer Solutions :The second strategic option presented by the Triangle Hax and Wilde is the Total Customer Solutions, which is to deliver a portfolio of customized products and services that represent a unique value proposition for our consumers.This alternative emphasizes that innovative initiatives of our company does not depend solely on our internal capacity to develop new products, but efforts to develop them together with our consumers.

3. Closure System (System Lock-In):This strategic choice is extremely attractive but not any company can adopt, because it requires the ability to define and position the industry standard, or property distribution channel chosen by consumers.The interesting thing about this approach is that it leads us to think about the entire network that allows us to improve our customer experience and identify complementizers that enrich our offerBeyond the strategic position chosen by the company, the Delta model proposed as winning formula:

Focus on the consumer: to achieve linkage with the consumer ("customer bonding"), it is necessary to segment our customer base and develop the best possible knowledge of them.Choose the most convenient strategic position: the level of relationship with the consumer will depend on the value proposition that creates the choice for the consumer target positionDefine the strategic agenda that will allow our company to implement the strategic optionDesign metrics (KPIs) and rewards to facilitate the development of the strategy

Here you can see the entire Delta model for achieving customer bonding:

Source: Hax, Wilde (2003).The Delta Model - a new framework of Strategy.Journal of Strategic Management EducationHaxioms

Haxiomsare a set of principles, proposed by Arnoldo Hax, which serve as a framework for the conceptualization of the Delta Model, and since it somehow challenges the conventional wisdom regarding strategic thinking:The center of the strategy is the customerThis is the center of the Delta Model, being the customer the driving force for all actions undertaken by the company. Thus, the effort the Organizations have to do is to configure high value-added propositions to customers which will be both creative and unique.You don't win by beating the competition. You win by achieving Customer BondingJust as the central focus of the management is the Customer, the central focus of the strategy should be Customer Bonding. This stage is recognizable by a relationship based on transparency, fairness, and which produces long term benefits for all involved.

Strategy is not war; it is LoveWhen we define the essence of strategy as a competitive advantage, we are at the same time denoting conflict as the way to think about business. If instead we reject this notion, our mind opens up to new alternatives and, since we are no longer in confrontation with our partners, other forms of cooperation can be considered. The extreme way of non-conflict is indeed LOVE.A product-centric mentality is constraining; open your mindset to include the customers, the suppliers and the complementors as your key constituenciesSince all business are related and dependent on other members of the supply chain, a wider view is needed to see thisexpanded enterprise, which is the entity of real importance in our strategic analysis. In this way we can better propose high-value propositions to our customers.Try to understand your customer deeply. Strategy is done one customer at a time.The granular customer analysis is fundamental to complete a sensible customer segmentation. the extreme is in fact the consideration of each single customer individually with his/her own needs and wants.