Cost vs Value - Where do you play?

Over the last 8 years as an entrepreneur, I have learnt that value beats cost on the long run. I want to narrate an incident that happened with TaUB Solutions ?

One of our Client wanted us to do a program on DevOps in 2017 and we submitted a proposal with all our capabilities and value proposition. The Business had to pass it on to the Procurement team to make the decision after shortlisting the prospective service providers.

The Procurement team came to us for Negotiation and told us that our cost was 50 % higher than closest bidder and asked if we could match that value in order be awarded the contract.

I politely refused saying, I respect your decision but we will not be able to go below our pricing considering the level of value and experience we have in creating DevOps as a Capability.?

I also suggested that if the training that is planned does not deliver value, the employees are going to be demotivated. I also warned them that they will be doing disgrace to their task force because the final decision is made around only cost.

After 3 weeks, the procurement head called me and asked us to do the training without any negotiation. They were very apologetic on how the decision to go with a cheaper provider had adverse consequence on the morale of the team and productivity of the organisation. So in reality the company paid 150% to get the training delivered.

If you still believe, cost is always the deciding factor, It might not be completely true. Don’t get me wrong. Costing is a crucial factor for making decisions. ?

As long as you are considerate about your client investment and the value being generated, you will win in the long run.?Do not cut corners to get a deal… This would also mean you?have to walk away sometimes not picking up the opportunity because there is not a sense of mutual respect.

If you believe yourself to hang on for a long period of time, see how much more value addition you can create for your clients and business partners to become successful. Focusing on measurable outcomes at the end of the engagement have helped us retain customers and we are indeed very grateful for the same.

Finally Customers are willing to pay premium as long as they are guaranteed a desirable customer experience #XLA?#customerexperience #valueenablers #businessoutcomes #CustomerDelight #entrepreneurship #storiesfromthetrenches

So what has been your experience on Cost Vs Value Conversation with your Client and how have you handled this dilemma? Would love to hear your thoughts and perspectives..