DELTA

MOD EL
MADE BY:PRAKHAR PORWAL

EVOLUTION

The Delta Model was developed by Dean &

Company co-founder Dean Wilde, and
Arnoldo Hax of the MIT/Sloan School of
Management, to help managers formulate
and implement effective corporate and
business strategies.

WHAT IS DELTA MODEL:

Delta modelis a customer-based

approach to strategic
management. Compared to a
philosophical focus on the
characteristics of a product
(product economics), themodelis
based on customer economics.
The customer centricmodelwas
developed by Dean Wilde and
Arnoldo Hax.

The Delta Model is a new strategic

approach focused on building longterm strategic relationships and
creating value through "bonding" with
customers

1. BEST PRODUCT :

In this way, the authors

concentrate two of porter's
generic strategies: the low
cost and
differentiation;both are
centered on the
product.Hax and wilde are
the best product position
as unsustainable in the long
run and tending to the
commoditization of the
offer.

2. TOTAL CUSTOMER SOLUTIONS

:

The second strategic option

presented by the Triangle Hax and
Wilde is the Total Customer
Solutions, which is to deliver a
portfolio of customized products
and services that represent a unique
value proposition for our
consumers.This alternative
emphasizes that innovative
initiatives of our company does not
depend solely on our internal
capacity to develop new products,
but efforts to develop them
together with our consumers.

3. CLOSURE SYSTEM (SYSTEM

LOCK-IN):

This strategic choice is extremely attractive

but not any company can adopt, because it
requires the ability to define and position the
industry standard, or property distribution
channel chosen by consumers.The interesting
thing about this approach is that it leads us to
think about the entire network that allows us
to improve our customer experience and
identify complementizers that enrich our offer

BEYOND THE STRATEGIC POSITION CHOSEN BY

THE COMPANY, THE DELTA MODEL PROPOSED AS
WINNING FORMULA:

Focus on the consumer: to achieve linkage with the

consumer ("customer bonding"), it is necessary to
segment our customer base and develop the best
possible knowledge of them.
Choose the most convenient strategic position: the
level of relationship with the consumer will depend on
the value proposition that creates the choice for the
consumer target position
Define the strategic agenda that will allow our
company to implement the strategic option
Design metrics (KPIs) and rewards to facilitate the
development of the strategy

HERE YOU CAN SEE THE ENTIRE DELTA MODEL

FOR ACHIEVING CUSTOMER BONDING:

Source: Hax, Wilde (2003).The Delta Model - a new framework of Strategy.Journal of

Strategic Management Education

HAXIOMS

Haxiomsare a set of principles, proposed by Arnoldo Hax, which

serve as a framework for the conceptualization of the Delta
Model, and since it somehow challenges the conventional
wisdom regarding strategic thinking:
The center of the strategy is the customer
This is the center of the Delta Model, being the customer the
driving force for all actions undertaken by the company. Thus,
the effort the Organizations have to do is to configure high
value-added propositions to customers which will be both
creative and unique.
You don't win by beating the competition. You win by
achieving Customer Bonding
Just as the central focus of the management is the Customer, the
central focus of the strategy should be Customer Bonding. This
stage is recognizable by a relationship based on transparency,
fairness, and which produces long term benefits for all involved.

Strategy is not war; it is Love

When we define the essence of strategy as a competitive
advantage, we are at the same time denoting conflict as the
way to think about business. If instead we reject this notion,
our mind opens up to new alternatives and, since we are no
longer in confrontation with our partners, other forms of
cooperation can be considered. The extreme way of nonconflict is indeed LOVE.
A product-centric mentality is constraining; open your
mindset to include the customers, the suppliers and the
complementors as your key constituencies
Since all business are related and dependent on other
members of the supply chain, a wider view is needed to see
thisexpanded enterprise, which is the entity of real
importance in our strategic analysis. In this way we can
better propose high-value propositions to our customers.
Try to understand your customer deeply. Strategy is done
one customer at a time.
The granular customer analysis is fundamental to complete a
sensible customer segmentation. the extreme is in fact the
consideration of each single customer individually with
his/her own needs and wants.