Value: The perception of worth in usefulness or importance to the possessor, in utility and quality.
This is a static definition. There is another component of value that relates to time and progress. You bought the best mousetrap that money could buy based on the traditional definition. You then found out that a new and superior concept had just become available from a competitor. You did not buy the best value. So while appearances say one thing, the real value may be something different based on the dynamic progress curve. Both the supplier and the buyer have a problem in that example for obvious reasons.
The three-year-old PC that is being used to record this effort cost double that of a device with the capability five times as great at the time this is being written. This may sound like a complaint, though actually it is a testimonial to progress. The buyer, the supplier, and the competition must try to anticipate that rate of advance to be able to decide on their most advantageous direction and what represents the best value, all things considered.
If traditional mousetraps or auto components are planned by a supplier because retooling their processes and equipment is cost and time prohibitive due to its high volumes, it is not a good plan. An intelligent competitive posture regarding the industry’s next generation product timing should forge that plan. A “fast on his feet” competitor may be ready to introduce innovative new component versions on lower production scales for his competition-minded customers.
The higher the volume, the more difficult and expensive it is to be fast on your feet for competition and market responsiveness and to take advantage of technological advances. However, there are important examples where a marriage of dedication and flexibility is the wise choice (see addenda.)
Value (author’s “dynamic value” definition): The perception of worth in usefulness or importance to the possessor, in utility, quality, and innovation.
Innovation is a component of value in the same definition as quality? It’s true, because passionate, imaginative, and courageous people manage the risks associated with applying emerging technology and gain an edge against aggressive competitors. He or she “found a way.” This will enhance the utility component of value and the useful life of the subject over competing products. It can even make competing products or offerings obsolete.
This definition contains a reminder to some, whose paradigms may narrow their vision, that “quality” is only one of three components of value. Even the highest level of quality has little meaning in a product made obsolete by competitive innovation. Some say quality is the price of admission to a competitive exercise.
Is the direction of high-volume, large organizations supplying multiple auto manufacturers cheap and profitable parts the right one? It’s probably the right one for the parts supplier, at least in the short- term, as he has a lock on nicely profitable business. But what about the auto company and the consumer, you and me and even the supplier, when value-conscious buyers become aware?
Smaller (maybe just in spirit) American suppliers or those competing in and from foreign markets could be faster on their feet and innovative. They could be better able to survive and provide each of their auto company customers different, advanced, better, and cheaper products (dynamic value) - the small isolated populations. Remember that innovative methods and processes developed in a competitive environment can provide the product designer with versatility that he had lacked and that his competitors will still lack.
Enterprises and even entire industries can easily be blinded by their own paradigms. The perceived benefits of economies of large-scale parts production at the expense of real freedom to innovate and compete can be misleading. Restricting rather than providing the freedom to use their full resource of human imagination, passion and courage will retard their competitive posture against all comers especially the small isolated populations.