Book Excerpt: Transforming Intangibles Into Gold

The following is an excerpt from the book Lead by Greatness.

Identifying people's deep intangible needs creates opportunities for product innovation and sometimes even for new industries.

Intangible assets such as culture, intellectual property, leadership competence, and reputation add a lot to a company's worth. Although it is difficult to measure the value these intangible assets add to a company, various methods have been developed to try to do so. One simple method of measuring the economic value of a company's intangible assets is to determine its ability to outperform competitors that have the same or more tangible assets.

Intangibles can translate into even more value when they are also used to add to the customer experience. Think about what happens when you apply intangible values like appreciation, generosity, humility, and dignity to the way you view and interact with your customers. What might that do to your sales and profit margins? What might happen if you sought not only to give meaning and purpose to the people who work for and with you, but also sought to satisfy these same intangible needs in your customers?

We tend to view customers as people that have a need for things or services, but people will often pay significantly more if those things or services also satisfy their deeper, intangible needs and desires. Consider how much more some people are willing to pay for a first-class or business-class seat on a flight when a discounted economy-class seat would get them to the same destination in the same amount of time. The extra cost is not always justified merely by the additional space and better meals and service. In the same way, people will often pay more for a brand-name fashion item than they would for a similar piece of generic clothing.

[i] Schultz and Raiton, "Knowledge As Intellectual Property," (2005).

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