Organisational Coaching – Great Organisations and Great Managers

The report of my illness grew out of his illness. The report of my death was an exaggeration. (Mark Twain, May 1897.)

Let's illustrate our definition of value using the travel industry.

The rise of the Internet threatened to put travel agents on the list of endangered species. Travel agents, along with all the other business in the genus of Middleman were destined for eventual extinction. The prophecy was logical. Airlines, like the over quoted example of Dell Computers, could bypass travel agents and sell directly to their customers. As time has shown the death of travel agents, and other middlemen, turned out to be an exaggeration. Even Dell sells through channels now.

The misunderstanding arises from a confusion over the nature of value. So let's go back to our definition of value.

Value is the tangible benefit our customers receive from our organisation, that they can not get from our suppliers and they can not, or do not want to, obtain for themselves.

I use a travel agent (Denise at Fortune Travel). What do I get from a travel agent that I can't get from the travel agent's supplier (the airlines)?

1. It's faster. So much faster.

2. The price directly from the airlines is not always the best offer.

3. They can bundle with other providers. One call and the airline, accommodation, travel insurance, airport shuttles and an optional tour are covered.

4. They can remember preferences across multiple airlines.

5. They can waitlist.

   and the big one

6. A good travel agent reduces the risks and uncertainty associated with travelling.

So if all I want is:

• a seat on an airline
• to a destination I know
• with no need to wait list,
• and no need to consider and weigh alternatives,
• and no other requirements such as accommodation, rental cars or shuttles
• with spare time to search out and deal directly with the airlines

then I will book directly with the airline. In this case a travel agent adds no value and I should deal directly with the travel agent's supplier - the airline.

Usually one or more of these requirements is not true. If I want more than what an airline can offer, my first choice is to fill in the gaps by myself. This also happens to be a very time consuming activity and I just don't have the time.

Travel agents add value because they give us something we can't get from their suppliers and something we don't want to do for ourselves.

The big question now in front of travel agents is; who is going to pay for that value?