What is the Law of Value from the Five Stratospheric Laws of Success? How does Joe from the Go-Giver learn about the law?
The Law of Value says that how much more you give others in value than you receive in payment defines your worth. Joe learns that you should give, not as a strategy, but as a way of life.
Continue on to learn more about The Law of Value and how Joe applies it in The Go-Giver.
The Law of Value
The Law of Value: How much more you give others in value than you receive in payment defines your worth.
Joe and Pindar had their second meeting at Iafrate’s Italian-American Cafe, a popular restaurant, judging from the crowd size. Ernesto, the head chef/owner, joined them at their table. He explained that he started his career with just a hot dog cart. His stand became popular, eventually being voted the best outdoor dining experience in the city. He started a restaurant with the help of a mysterious investor, known only as “the Connector,” then came to own a half-dozen restaurants. Later, he invested in commercial real estate; his holdings totaled several hundred million dollars worth.
The key to Ernesto’s success was the exceptional value he gave his customers beyond the food they bought from him, starting with his hot dog stand. He made buying a hot dog a memorable dining experience by building relationships with his customers—he remembered not only customers’ names and preferences, but also their children’s names and birthdays as well as many details of their lives. Children brought their parents and parents brought their friends and associates to his stand. Several customers then became Ernesto’s partners in further business ventures.
Ernesto explained his philosophy of the restaurant business this way:
- A bad restaurant provides only the level of food and service necessary to justify what it charges.
- A good restaurant provides the highest quality and greatest quantity it can for the price.
- A great restaurant strives to provide better food and service than its customers can pay for.
This approach exemplifies the Law of Value: Go-Givers believe that how much more you give others in value than you receive in payment defines your worth. Joe countered that emphasizing giving over profit could lead to bankruptcy; it’s as though you’re avoiding making money. However, Ernesto replied that the first priority should be whether your enterprise serves and adds value to others. If it does, then ask whether it makes money.
You should give, not as a strategy, but as a way of life. When you do, profits or other benefits follow because people want to do business with you.
The meeting broke up; the next day’s visit would be with “the CEO,” who would explain the Law of Compensation.
Before the next lesson, however, Joe was tasked with applying what he’d learned that day about the Law of Value and giving more than he would get in payment.
Back at the office, his first priority was coming up with a way to meet his third-quarter quota; his phone rang and his problems got worse. It was Jim Galloway, a lawyer representing a multinational company whose contract with Joe’s company was up for renewal. Jim had bad news—his client wanted to switch to a firm with stronger international connections and Joe was losing the account.
Suddenly remembering the Law of Value, go-giver Joe passed on the name of a competitor, Ed Barnes, who had the qualifications Jim’s client was looking for. After hanging up, he couldn’t believe he had just referred a client to a competitor. However, his colleague Gus, who’d overheard the call, nodded approvingly.
———End of Preview———
Like what you just read? Read the rest of the world's best book summary and analysis of Bob Burg and John D. Mann's "The Go-Giver" at Shortform.
Here's what you'll find in our full The Go-Giver summary:
- Why giving will take you further than getting
- The Five Laws of Stratospheric Success
- How giving isn't the same thing as always being nice