The Value Discipline Framework was developed by Michael Treacy and Fred Wiersema in their 1995 book The Discipline of Market Leaders.
These are 3 disciplines in the framework:
🤝 Customer Intimacy
🎁 Product Leadership
🚀 Operational Excellence
A company must achieve either basic or leadership competency in each discipline.
🔴 Basic or minimum competency: the minimum needed to remain competitive.
🟢 Differentiating or leadership competency:makes the product/service stand out in the market.
The basic assumption is that it is difficult for a firm to compete in all 3 disciplines and should choose 1 that it can excel at.
🤝 Customer Intimacy – Responds to customer needs
🎯 Tailored offerings to customer segments
💖 Long-term customer loyalty strategy
🚀 Operational Excellence – Provides products/services at low or competitive prices
⚙️ Operational efficiency keeps costs low
🎁 Product Leadership – Innovative products/services
⏱️ Low time to market – launch new products ahead of competition
🤝 Customer Intimacy
🛒 Amazon – customised product and delivery
💳 American Express – exclusive benefits
🚀 Operational Excellence
🪑 IKEA – efficient product design, low-cost retail model
🍔 McDonald’s – standard processes, purchasing and training
🎁 Product Leadership
📱 Apple – iPhone, iPad, Mac computers – ahead of competitor products
🎮 Sony – high-quality innovation – PlayStation, TVs
🤝 Customer Intimacy
📊 Customer segmentation – use CRM/customer database
🗣️ Customer feedback – surveys and client engagement
🎁 Loyalty or reward programs
🚀 Operational Excellence
⚙️ Streamline operations – use ERP and planning systems
📦 Optimal purchasing – negotiate supplier contracts
🚚 Efficient distribution and warehousing
🎁 Product Leadership
🔬 Research & development
⚡ Rapid prototyping
📈 Monitoring trends in the market
🤝 Collaboration with researchers and other innovators
