Page 116 - Design for Six Sigma for Service (Six SIGMA Operational Methods)

94 Chapter Five

5.5 Competitive Customer Value Analysis

Competitive customer value analysis is a graphical display chart that can be
used to compare your product versus competitors’ products in important
aspects of customer value. This analysis will show you which areas are the
most important to focus on to improve your product most effectively.
Here we can use the following example to show how competitive customer
value analysis works. Table 5.6 shows a market-perceived quality profile of
two printers, printer A (our printer) and printer B (competitor’s printer).
Table 5.7 shows the market-perceived price profile of these two printers.
Figure 5.3 shows a head-to-head customer value area chart that compares
printers A and B. Each bar represents a market-perceived quality charac-
teristic. The horizontal dimension of the bar shows how much our product
is better or worse than our competitor’s product. The thickness of each bar
is proportional to the relative importance of each characteristic. So the total
area in white represents our advantage; the total shaded area represents our
disadvantage. Our goal will be to maximize the white area and minimize the
shaded area in the most effective way.

Figure 5.4 shows a head-to-head market-perceived price ratio chart for
printers. Again, each bar represents a customer cost component, its hor-
izontal dimension represents how much better or worse our product’s price
compares with our competitor’s price, and the bar’s thickness represents the
relative importance of that cost component in the eyes of customers. So the
total area in white minus the total shaded area represents our product’s cost
advantage; the larger the cost advantage, the more competitive is our
product in price.

5.6 Customer Value Deployment
After our competitive customer value analysis and relative price ratio
analysis, we need to find an effective way to overcome our disadvantages
and strengthen our existing advantages in order to improve our customer
values and win over the competition. To do that, we need to identify the
critical areas of the company that are related to our key market-perceived
quality factors and market-perceived customer cost areas.

A quality function deployment (QFD) like template can be very useful in
deploying key customer values into our process improvements. Table 5.8
shows the customer value deployment matrix for the printer case. In this