Let's be analytical!

For the second article of these chronicles I will go through the analitical part, my prefered one: - Ownership Cost!

The ownership cost can be really simple, and specially if we talk about a spare part, a wearlable, a consumable, you have a product that costs 36 € and its life ends after 36 months, so the cost of ownership can be simply 1€/month.

Now comes the nicest part! Let's add complexity, add some inteligence, add more analytics to it, hard! The fun is to make it looks simple.

Although to take a next step and go depper in the analysis, more data is needed! Some time you have it or not! you can ask, you can guess, you can do the fool's game to get it, you can investigate or search. No additional data available, no added value to work on and to use on the negotiation!

Let's have a look and add the so called "added value", nice phrase and commonly used but it can be just:

• The product allows a prodution increase of 15%!
• The product allows an improvement in terms of safety, that decreases in 20% the number of accidents.
• The product allows to safe cost in terms of maintenance! Yes, but how much is it?
• The product has a very low or no maintenance needed! Yes, but that is a benefit, if it can be accountable? If so you have added value!
• The product is very simple to install/mount! Yes, and again no amount! no added value!

A technical and analytical aproach, has always a technical product behind, after all its audience normally is an industry, a productive area, a maintenance area or similar! It has always Ownership Cost + Added Value!

Remember that a technical product does not fight to have a place on a shelf, instead is there to perform, offering benefits ofcourse, but the best one may has the average cost of ownership and a tremendous added value!

It can happens that the cost of ownership is the lowest, but there is no added value, even it can make you spent 10% more in maintenance, for example. Is it a better one? It depends on the main need, maybe you are happy to spent more in maintenance!

To have a clear and correct analysis, cost versus benefit, to the cost of ownership you need to add the added value. You don't know the added value!? Search for it, sometimes it can be in front of you... Ask! Once again make good use of your senses!

Just having the Ownership Cost, it can be even more complex! Imagine that your ownership cost is the same as your competitor. How are you going to differenciate?

At the end you need to differenciate, being better in ownership cost, but how that contributes to the main need? What is the added value?

Some time ago I used to say that the most powerfull drilling machine with the worst drill bit in the market or the worst drilling machine with the best drill bit, will not perform for sure! They are a set and they work as such, as a complete set!

The same with the ownership cost and the added value! But there are more than just these two in sales... There are also the people! One of the most important! But that is for another chronicle...