VALUE PROPOSITION
R.D. SISSON
INNOVATIONS: HOW TO “SELL” THEM
THE VALUE PROPOSITION!

Can you explain your innovation/thesis in 3 minutes?

Including the need, the approach, the benefits and the
competition/alternatives?
Need
• 50mpg?
• Zero emissions?
• Comfort and
style?
Approach
• Weight
reduction by
materials
substitution?
• Improved
engine
technology?
Benefits
• Increased
market share?
ELEVATOR PITCH EXAMPLES
• http://www.youtube.com/watch?v=Tq0tan49rmc
• http://www.youtube.com/watch?v=QK3ZdaoKXNQ
&feature=related
• http://www.youtube.com/watch?v=Edgz93EXKk&feature=related
THREE MINUTE THESIS EXAMPLES
• http://www.youtube.com/watch?v=Hah0OqK7D8M
• http://www.youtube.com/watch?v=sUd33kREcxE&f
eature=related
• http://www.wpi.edu/Admin/Provost/GRAD/2011ipc.
html
VALUE PROPOSITION DEFINITION

Your Value Proposition is: a statement that includes
your important customer and market

Need along with your new, compelling, and defensible

Approach to address that need with superior

Benefits per costs when compared to the

Competition and/or other alternatives

Successful Value Propositions are quantitative and
easy to understand and remember

The four parts of your value proposition are the
fundamentals: they must always be answered
AN ALL-TOO-TYPICAL FIRST DRAFT…
“The world needs a little red wagon …”
AN EVERYDAY EXAMPLE
I understand that you are hungry (Need). Let’s go
to the Campus Center (Approach). It has great
food, it’s quiet, and we can continue our discussion
better (Benefits/costs) than McDonald’s
(Competition/alternative).
 We naturally create Value Propositions in our
everyday life
 An SRI employee even developed one for a marriage
proposal
 It worked!
 When translated to the business environment, they
are remarkably rare
 Remember: only your customer defines your value
IMPROVE YOUR VALUE PROPOSITION,
BE QUANTITATIVE
Need
•Not: The market is growing fast
•Rather: Our market segment is $2B/yr and growing at 20%/yr
Approach
•Not: We have a clever design
•Rather: We have created a patent-protected, one-step process
that replaces the current two-step process with the same quality
Benefits
•Not: The ROI is excellent
•Rather: Our one-step process reduces costs by 50% and results in an
expected ROI of 50% per year with a profit of $30M in year 3
Competition
•Not: We are better than our competitors
•Rather: Our competitors are Evergreen Corporation and Bigway,
which use the current two-step process
Qualitative statements are not persuasive!
I 3 – JUDGING CRITERIA
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The Need was clearly presented in a compelling presentation. (0 – 10)
(0-1) did not hear a need
10 = the need was important and clear.
-Is the idea based on a clearly identifiable client/customer need?
-Is it innovative, bold, and world-changing?
-Has the need been clearly defined and supported?
The Approach will meet the Need. (0 – 5)
-Does the idea represent a truly original concept?
-Has technical feasibility been demonstrated?
-Has a reasonable strategy for moving ahead been made?
-Is there a path to commercialization?
The Benefits of this project are clear. (0 – 5)
-Is the value proposition defined?
-Is there intellectual property involved?
-Is there market data to support the proposed strategy?
-Does the idea have a competitive advantage?
-Is it a viable investment candidate?
The Costs and Competition are clear. (0 – 5)
-Have the risks inherent in the idea been identified and dealt with?
-Is there a plan to mitigate risks?
-Is feasibility based on evidence or assertions?
REFERENCES
• SRI International
• Slides – with RDS additions – from Curt Carlson –
CEO SRI
• Innovation by Curtis R. Carlson and William W.
Wilmot, Crown Business, 2006.