The Ends Game: How Smart Companies Stop Selling Products and Start Delivering Value

by Marco Bertini, Oded Koenigsberg

How some firms are rewriting the rules of commerce by pursuing “ends”—actual outcomes—rather than selling “means”—their products and services. Would you rather pay for healthcare or for better health? For school or education? For groceries or nutrition? A car or transportation? A theater performance or entertainment? In The Ends Game, Marco Bertini and Oded Koenigsberg describe how some firms are rewriting the rules of commerce: instead of selling the “means” (their products and services), they adopt innovative revenue models to pursue “ends” (actual outcomes). They show that paying by the pill, semester, food item, vehicle, or show does not necessarily reflect the value that customers actually derive from their purchases. Revenue models anchored on the ownership of products, they argue, are patently inferior. Bertini and Koenigsberg explain that advances in technology have made it possible for firms to collect “impact data” that tells them when and how customers use their products and how those products perform, and that firms can draw on this data to turn products into seamless services. New revenue models will enable transparency, accountability, and efficiency.
Bertini and Koenigsberg offer real-world examples of how companies in healthcare, transportation, education, and other sectors are already playing “the ends game,” describing, among other things, the successes of Dollar Shave Club, Rent the Runway, and “pay as you fly” insurance for drone flights.
Finally, they outline the challenges in adopting these new models, offering guidance on such issues as criteria for defining an outcome, concerns over data collection, and internal organizational obstacles.

Genres: Business

200 pages, Hardcover

Published September 8, 2020

Reviews

[Mark Frantz · Rating 5 out of 5]

I really liked this book. Inspiring and enlightening on how the business sector can innovate and deliver value to the market while expanding efficiency and positive impact.

[Fred Cheyunski · Rating 4 out of 5]

“Promises to Proof” Still a bit “Aloof” - Having finished a couple other books in this MIT press collection (e.g. see my review of Ross et al’s “Designing for Digital”), I saw this title which seemed interesting and very much in line with the series editor’s aim----presenting that “. . . rare breed of idea— meaningful to practice, grounded in evidence, and built for the future . . . “ As I proceeded with the text, I was reminded of “value realization” and business case work as part of our approach at IBM Business Consulting that were often arduous and complicated efforts. However, due to advances in information technology and big data use, there are increasing possibilities to build such activities into regular offerings including the way products and services are devised and delivered---even how the enterprise is conceived. As the authors remark in their introduction, their topic involves moving from “promises to proof,” even though there is a ways to go on that score [you might say it is still harder to score in playing “The Ends Game,” but increasingly becoming worth the attempts].

More specifically, after the series and book introductions, the book proceeds through 11 chapters divided into three parts. In particular, Part I: Context consists of chapters that describe the “Ends Game” as (1) Unfinished Business, (2) Beyond Needs and Journeys, and (3) Leaner Commerce; Pat II: Models presents examples that deal with (4) Shaving, Rocking Out, and Looking Fabulous, (5) Flying Hours, Wash Cycles, and Miles Driven, and (6) Laughter, Rocks, and Quality of Life; Part III: Action offers chapters that concern (7) Committing to Outcomes, (8) Breaking the Quality Paradox, (9) Getting Up Close and Personal, (10) Partnering with Customers, and (11) Making Your Move. Finally, there are Notes for references used to support the narrative in the respective chapters.

My favorite parts include those where Bertini and Koenigsberg trace business transaction evolution and reasons these interactions have the potential to become part of a more efficient and effective leaner commerce. Included here are comments from Marshall McLuhan on the ways that focus on access and mass consumption came from early retail, railroads, marketing and advertising. Then there is the remark by Peter Drucker that describe the typical situation as one where “The customer rarely buys what the business thinks it sells” (see my review of Rushkoff’s “Throwing Rocks at the Google Bus” as a book that offers further such observations). In response, they allude to technological advancements of the last two decades, and especially the last five years in the way of hardware, connectivity, and intelligence to explain that businesses “. . . now have a spectrum of revenue models to choose from in order to drive . . . change” such as those pertaining to access (e.g. subscriptions and membership), consumption (e.g. metering usage) and performance (e.g. outcomes achieved). Such models bring to mind Schrage’s “Serious Play” and Kelly’s “The Inevitable” in terms of capabilities that might be tapped.

Early on the authors pose the questions “Would you rather pay for health care or better health? Would you rather pay for school or education? Groceries or nutrition? A car or transportation? A theater act or entertainment?” (see my reviews of Porter and Teisberg’s “Redefining Healthcare” and Schumacher’s “Dear Committee” that pose similar queries each in their own manner). Later, they proceed to give examples of new model introduction in different sectors such as in shaving (Harry’s), music/video streaming (Pandora, Netflix), women’s clothing use (Rent the Runnway), drone flight insurance (Flock/Alianz), pay per wash (Winterhalter), miles driven (Michelin tires that bring to mind my review of Hollebecq’s “The Map and the Territory”), pay per laugh (Spanish theater Teatreneu), rock-on-ground (Orica Blast Operations), and learning outcomes (academic textbook publisher Pearson). Yet, Bertini and Koenigsberg mention cases like HP’s Instant ink which appears to include outrageous prices for refill printer cartridges, where knock-offs might be obtained at significantly lower cost. Another questionable area seems to be the continued cable provider bundling which has led to the “chord cutting” they describe which may offer some of the access consumers are seeking (but with different kinds of limitations).

While there are promising signs, it seems such models will require increased development and testing to become more viable and widespread. Similarly, the figures in the book are helpful but only 3 are provided. Moreover, most guidance and method is interspersed within the narrative causing one to work to tease it out. Despite these difficulties, the book offers a helpful articulation of topics worthy of further attention and pursuit in order to come closer to fulfilling their potential.

[Y.S. Stephen · Rating 3 out of 5]

The Ends Game examines what it truly means for a business to put customer care at the centre of what they do. It explains new and old research about the consumer and how companies can benefit from these perspectives in today's digital market.

WHY I LOVE THE BOOK
The authors give loads of examples of companies who are on the right path as far as customer care is concerned. It is refreshing to see where a few businesses have gone wrong and what some have done right.

DISLIKES
It is a dry read and takes some effort for those who are not business or economics nerds.

WHO IS IT FOR
Anyone who is looking to start or invest in a business needs to give this a look.

Many thanks to MIT Press for a review copy.

[Greg · Rating 4 out of 5]

The Ends Game examines what conpanies can do to put the needs of the customers as the paramount consideration in driving their revenue models. It discuss how to minimize wastes in access and pertormance of their products and services.

The book is typically straight forward and academic. Although I think it still has room to improve by adding stories done in a way that’s exciting. It will hook more readers if its more entertaining. The book could have expounded on its stories.

[Bruno Rio · Rating 4 out of 5]

A very interesting take on how companies can/should review its own business and revenue model to shorten the gap between how customers perceive value from one product or service and how companies get paid. A quite theoretical approach but very interesting if you take the time to think it over.

We're currently going through a change from property to access revenuel models » membership and subscription. Next step will be performance/satisfaction based economy.

Food 4 thought!

[Eleodor · Rating 5 out of 5]

Loved the brilliant example of a creative business revenue model from Teatreneu, a comedy theater in Barcelona. In 2013, when the Spanish government increased the tax on theater tickets from 8% to 21%, Teatreneu introduced its “Pay-per-Laugh” customer-payment pricing system built on a AI facial-recognition system that registers each time someone in the audience laughs.
Teatreneu customers don’t pay anything to get inside the comedy club’s performances but on a per-laugh basis.

[Theodore Kinni · Rating 4 out of 5]

Just read the manuscript. Really good overview of revenue models that generate business by enhancing customer access, consumption, and outcomes (like Dollar Shave). Business strategists and entrepreneurs will want to check it out. Book coming in Sept.

[Darya · Rating 3 out of 5]

Interesting concepts of the future of commerce delivered through an observation of different businesses trends. Will commerce become customer -centric? There are trends showing that subscription service gets its modifications too: pay for what/how much you use is getting power of new cumtomer/business relationship.

[Ronald J. · Rating 4 out of 5]

I enjoyed this book, it makes you think about constantly evolution in business models. The authors note how the subscription business model is all the rage now, but is there any doubt models will evolve beyond that—at least the revenue model. As they write: “Companies seldom challenge what they ask their customer to pay for. (the revenue model question) and instead obsess over the secondary, far more tactical issue of how much customers should pay (the price question).” As they say, would you “rather pay for health care or better health? School or education? Groceries or nutrition? A car or transportation? A theater act or entertainment? Paying by the pill, is a poor reflection of the value that individual and business customers actually derive from their purchases.” We need to evolve from selling “means”—products and services—to “Ends,” the outcome or transformation the customer actually values. Our revenue model should match the Ends, and that’s no easy thing, the authors recognize. Still, they provide some examples, from pharma companies being paid for actual results, textbook companies, among others. There is usually inefficiency, or friction, around Access, Consumption, or Performance (results, not promises). While I have some reservations around their claims of inefficiency in markets, there’s no doubt that markets evolve to find better ways. This book will make you think about the right questions, and is worth the read.

We interviewed Marco Bertini on The Soul of Enterprise in October. You can listen here: https://www.thesoulofenterprise.com/t...