Margaret Cullen, Andre P. Calitz, Stefan Buys
Abstract
Today’s competitive business environment forces organisations to rush to introduce new products and services neglecting to analyse the market to ensure that they fully understand and can satisfy its needs. This research was undertaken to explore the problem of understanding customer needs for new products to be successful, thereby capitalising on the available growth potential. The aim of this paper is to advance the current understanding of the Customer Value Proposition (CVP) of Turnkey Project Based Organisations (PBOs) by performing a systematic analysis of the determinants of customer value. An exploratory quantitative method was utilised using literature and case study components to test hypotheses. The empirical study consisted of surveys (questionnaires) completed by various customers and employees of a company in the Eastern Cape, South Africa. Descriptive and inferential statistics were used to summarise the data.
The paper presents a model for evaluating of the CVP for Turnkey PBOs. Key findings from the statistical analysis include the strong influence that Relational Characteristics have on the perceived value offering of a Turnkey PBO. Factors that have a significant correlation with perceived value than others were identified as Supplier Commitment, Benefits, Supplier Flexibility, Joint Working and Brand Equity. In addition, employees of the organisation rate the Trust and Supplier Commitment factors of the organisation’s value offering higher than Customers do, which means that internally the organisation believes it is performing better in terms of Trust and Supplier Commitment than their customers do. The practical implication is that the organisation needs to adjust their value offering as Customers assign higher importance to the various Supplier Characteristics than the organisation’s employees do.