Simulating the Complex Sale – Feature

In December of 2019, featured Hanging Steel Productions. Read their report on our Value Clarity Model here.

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Book – Business Modeling: A Practical Guide to Realizing Business Value

In 2009, CEO and Founder David Bridgeland co-wrote Business Modeling: A Practical Guide to Realizing Business Value with Ron Zahavi. Check it out on Amazon.

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Clients and Customers

A value model has two different end user organizations, in two different roles. We use two different words for these end user organizations, in order to distinguish them: “client” and “customer”.
The “client” is the end user organization that has an offering that they are attempting to sell. The client employs sales professionals to sell this offering. The sales professionals work with the value model, both to better understand their prospective customers, and to estimate the value that the offering provides to those customers.
The “customer” is the end user organization that may or may not buy the offering. The value model is concerned with the value created or destroyed by the offering in the customer organization, so the value model is a model of the customer, not the client. The customer employs executives who are responsible for creating value—or preventing value from being destroyed—and who may (or may not) find the value creation opportunities provided by the offering to be compelling.
For example, consider software that analyzes oil and gas pipelines for potential leaks. The client is a software company, the company that makes and sells the analytics software. The customer is a company in the oil and gas industry, a company managing oil pipelines or gas pipelines (or both), and interested in preventing leaks. The value model is a model of the customer, and a model of the value at risk to the customer in the absence of this software. 
A particular value model is unique to a client, to reflect the unique offering provided by the client. In this example, the value model is unique to the business of preventing leaks in oil and gas pipelines, entirely different from other value models for other offerings in other industries.
A particular value model is configured  for each customer, with configuration variables that are changed customer-by-customer to reflect the differences between customer organizations.  Some customers manage thousands of miles of pipelines; others have smaller assets to manage. Some customers have pipelines located in wet climates where pipes corrode rapidly; others have pipelines in dry climates, where the corrosion is slower. And so on.

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Buyer Decision Support

At Hanging Steel Productions, we create buyer decision support apps, applications that help buyers make better decisions. 

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Modeling the Network

(This is a description of a particular model, a simple Excel model I use for my own business development. I explain it, mostly in words, but with a couple of graphs and a bit of math. If you want to skip the math, feel free; I think it is understandable without. If you want the model itself, let me know, and I will send it to you, as well as explain how to use it.)

Do you network enough? Does a friend have a great opportunity for you today, an opportunity you never learn about because you have not talked to that friend in six months, and your friend never thought about you? How many opportunities are you missing every week, every month, every year, because you are not talking to people you know?

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Open-Book Modeling

Models are often built as black boxes. A user can explore the dynamics of the model, trying different actions and viewing the results. But the internals are hidden: the user cannot see how his actions produce the results.

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Optimization Destroys Value

In 2009, Michael Dougherty and I created Mass Enrollment, an interactive simulation of the process of signing up illegal immigrants for an amnesty, should Congress pass a law granting immigration benefits to illegal immigrants. Mass Enrollment had a user interface, allowing the user to explore different sign-up processes, different temporary staffing strategies for the sign-up, and different strategies for application fees. Mass Enrollment simulated the dynamics of adoption: did immigrants apply at the first opportunity or did they wait to see what happened when others applied? Mass Enrollment simulated both legitimate applications, and also fraudulent applications by people who are trying to achieve immigration benefits with fraudulent documents. And Mass Enrollment simulated the backlogs in the process, showing which tasks in the selected process built up long delays.

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