Better, Simpler Strategy

18

Guiding Investment

Value maps are not only a powerful way to visualize trade-offs but they also help guide investments and connect strategy with operations. In this chapter, we will see how companies use value maps to link strategic choices with activities and budgets.

Choosing a Value Proposition

You will recall (from chapter 3) that a company’s ability to capture some of the value that it creates depends entirely on differences—differences in willingness-to-pay (WTP) or willingness-to-sell (WTS). By comparing your company’s value curve to the value propositions of your competitors, you can identify relevant differences and devise ways to heighten them. Let’s look at an example.

When Expedia, the online travel agency, set out to build its ...