On the face of it determining value seems quite simple - ask the customers what they see as value and work with that.
However, whilst working last week with an outsourcing organisation the first comment is who is the customer then? is it our client, the clients client, or the end user; this is made even more complicated when the "consumer" i.e. end user is not a true consumer as they don't actually buy the goods or services they are just subjected to them.
The chain delivers value to an authority rather than "actors" that the process is performed upon.
The answer is that we need to examine the value chain as a whole and see how various stakeholders get value and that value may not just be monetary but other aspects such as time delayed or degrees of intrusion.
In understanding the chain of value we can get all parties to agree on the value add through the chain, else as in so many outsourced arrangements the SLA's between the many partners in the chain create behaviours that destroy value from the chain as a whole.
Remember - end to end is the key not just analysis of a component part. So life in outsourcing and shared services isn't as simple as it first seems. If done badly outsourcing destroys overall value as fast as wet rot in a roof!
Sophisticated lean suggests examining the flow of value beyond ones own enterpise boundaries which is quite a step change in thinking for many organisations.
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