The Four Actions Framework

This  is a tool that helps decision makers to reconstruct buyer value elements into a new value curve that breaks the differentiation/low cost trade-off.

According to this tool four questions have to be asked and answered objectively:

First qyestion, which of the factors that the industry takes for granted should be eliminated?  This helps decision makers to consider eliminating factors that may have made sense in the past, but do not add much value to buyers anymore.

Second question, which factors should be reduced well below the industry's standard?  This helps the company to consider reducing factors that may have been over-designed in the race to beat competition.

[ These two questions address the low cost side of the equation by helping companies reduce their cost structure.]
Third question, which factors should be raised well above the industry's standard?  This question helps managers to find out and eliminate the compromises that the industry has forced buyers to make.
Fourth question, which factors should be created that the industry has never offered?  This question helps managers to discover new sources of value for buyers. The last two questions address the differentiation side of the equation.

This is an excersise that, every well established company should do every now and then.




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