The products and services that the one company supplies or the other procures, always consist of an actual deliverable with the active components as well as additional deliverables, the passive components, that are provided quasi automatically. Only if all aspects are put on the table, you can compare objectively. On supplier side, you get the arguments for the pricing. On customer side, the criteria for the selection and the decision can be derived. The time for describing the active and passive components of a deliverable and their consideration in the price comparison is well invested on both sides.

In order to understand all aspects of a deliverable or to be able to compare them, the active and passive components of an offer should be specified in detail.

• Active components
  The active components of a deliverable are the functions that are the customer’s major interest. Products are used (e.g. the car, the smartphones, the cooking pot) or spent (e.g. gasoline, food, electricity). Services are executed related to a person (e.g. a consultation or a care) or to an object (e.g. repair, maintenance) and cannot be stored or transferred. Even if all these components are obvious, ALL should be described.

• Passive components
  The passive components of a deliverable are the aspects that are delivered on top to the obvious active ones. These are essentially the qualities of the deliverable (e.g. the reliability, the safety, the economics, the brand, the experience) and information (e.g. the concepts, the branch knowledge, and the relationships) that are created in the course of providing the deliverable. They are rarely visible and are difficult to prove. For this reason, the absence of these aspects can only be seen, if at all, later in the process, e.g. after a breakdown or a quality check. In order to consider them in the selection process, the passive components should be estimated, e.g. by looking at the risks or by assessing the value-add.

The decline of the prices, due to the cheap production of the active components in countries with favorable production conditions (e.g. low labor costs, lack of environmental standards), leads to an increased importance of the passive components. The value of a brand, safety or the reliability of a deliverable become increasingly part of the value-add for the customer. Thereby, higher prices that have nothing to do with the actual value of the commodity can be argued. The reputation of consumer electronics plays a more important role than its sustainability (e.g. if the battery cannot be changed, like in some Apple products). Safety for the avoidance of dangers or the reduction of the effects of an accident is also important criteria in the purchase process of a car. The same is valid for services. The higher daily rates of renowned management consultations are more accepted, although the assigned employees have a similar education, as the ones of a smaller company that costs less.

Bottom line: The value of products and services is determined more and more by intangible aspects. Therefore, the specification of the requirements and the selection of the deliverables must be well defined in advance, in order to make the offers comparable.