Business Value Tree A Value Framework to identify, plan, create and realize value Improve Competitiveness Increase Shareholder Value Lower Risk Increase Operational Efficiency Increase Revenue Through Volume Optimization Increase Revenue Through Price Optimization Reduce Sales & Administration Costs Optimize Regulation Compliance Improve Business Recovery Improve Capital Management Improve Human Capital Management Improve Development & Production Improve Corporate Services Improve Logistics, Material & Services Optimize Intelligence Improve Risk Planning Improve Risk Management Improve Data Management Improve Customer Interaction Improve Customer Satisfaction & Loyalty Improve Partner & Relationship Collaboration Faster Time-to-Market Improve Responsiveness Improve Brand Awareness Strengthen Innovation Reduce Income Taxes Reduce Cost of Goods Sold Capital Optimization Critical Success Factors Key Performance Indicators Strategical Key Performance Indicators Tactical Key Performance Indicators Operational Strategic Business Objectives CMO RO O BD CCO FL S MS CMO FO/RE S BD CMO FO S MS CMO RE S MS CMO FO O MS CMO RE O MS CMO RE O MS CMO FO O MS CMO FO T MS CMO FO T MS CMO RO O IT CMO RE O MS CMO RE T MS CMO RE T MS CMO FL O MS CMO FO T MS CHRO RE T MS CMO RE S MS CMO FL O MS CMO FO/RE T GA CMO FO T GA CSO RE O BD CDO RE O BD CMO RE S MS CSO FL S MS CMO FO S MS CSO RE O MS CMO RE T IT CMO RO O IT CBDO RE T MS CSO FL/RE T MS CMO RE/FO O MS CMO FO T BD CMO RE T MS CSO FL/RE S MS CMO FO T OS CMO FL/RE O MS CPO FL S OS CPO FO S OS COO/CRDO FL S OS COO/CRDO FL S OS COO/CIO FL O OS COO FL O GA CHRO FL O GA CHRO FL O GA CHRO FL S GA CFO/COO FO S GA CFO/COO FO S GA CFO/CHRO FL O GA CFO FL S GA CFO FO S OS CFO FL S OS CMO FL/RE O OS CMO FO T MS CMO RE T BD CMO RO/FL O OS CMO RE O BD CMO FO O MS COO FL T GA COO RE T BD COO RO O OS CMO FO O BD CMO FL O MS CIO RO O OS CFO/COO RO/FO S GA CFO/COO RO O MS CFO RO/FO T OS CFO RO T GA CFO FO O OS CFO FL T OS CFO FO/RO O GA CFO FL O MS CFO RO O OS CRDO RE S BD CRDO FO O OS CPO FO S BD COO FL O BD COO FO O BD CMO FO T BD CMO RE O MS CMO RE T MS CFO FL S MS CPO RO T OS CPO FO T GA CIO RO/FO O GA CIO RO/RE S GA CIO FO O GA CHRO FO/RO O GA CHRO RO O GA CRDO FL O BD CPO FO S OS COO RE S OS COO RE S BD COO FL O OS COO FL O OS COO FL O MS CMO FO T MS COO/CRDO RE O OS COO/CRDO FO O GA COO/CRDO RE/FL S BD COO/CFO FL O OS COO FO T OS COO FL/FO S HR CRDO/CIO RE S MS CRDO FL O BD COO RE S BD COO FO O BD COO RO O MS COO FO O MS COO FO S BD CPO FO S OS CPO FO T GA COO FO O OS COO FL O OS CRDO FO S BD CMO RE T BD CMO RE O BD CMO RE O BD CRDO FO O BD CRDO RE O BD CRDO RE O BD CRDO FO O MS CMO/CRDO RE O BD CRDO FO S BD CRDO RE O BD CRDO RE O BD CRDO RE S BD CRDO FO O BD COO RE O BD CMO RE O BD CRDO RE O BD CMO/CIO RE T BD CMO FO T BD CRDO FO/RE S BD CRDO FO O OP CRDO FO/RE T BD CRDO RE O BD CRDO RE T BD CRDO RE T BD CRDO FO O BD CRDO FO T BD CRDO FO/RE S BD COO FO O GA COO RE/RO O GA CMO RE O MS CRSO RO O GA COO/CIO RE O GA COO RE/FL O GA COO RE O MS CIO FL S GA CFO/COO FL O GA COO RE O GA CIO FL O GA CIO RE/RO O GA CFO/CIO RE S GA CMO FO S MS CMO FO O MS CMO RO O MS CMO RO O MS CMO RO O MS CMO RO O BD CMO RE O MS CMO RO O MS CMO RO O MS CMO RO O BD CMO RO O MS CMO RO T MS CMO RO T MS CMO RO O MS COO/CIO RO O MS COO RE S MS COO RE O MS COO RE S MS COO RE O MS COO RE O MS COO RE O MS COO RE O MS COO RE S MS CMO/CIO RE S MS CMO/CIO RE O MS CMO RO S MS CMO RE T BD CHRO/COO FO O MS CHRO/COO FO O MS CFO RE O MS CFO RE O MS CFO RE O GA COO RE O MS COO RE T MS COO RE O MS COO RO O OS CMO RO O MS CMO RO O BD CMO RE T MS CHRO/CMO FO O MS CMO/COO RE/RO O MS CMO RE O MS CMO RE O OS CMO RE/RO/FO O MS CMO RE O MS CMO RE O MS CMO RE T MS CMO RE T MS CMO RE O MS CMO RE O MS CMO RE O MS CMO/COO RE/RO O OS CMO FO S MS CMO RE O BD CMO FO O MS CMO FO O MS CMO RE O MS CMO FO O MS CMO FO S BD CMO FL/RE S BD CMO FO O MS CMO FO O MS CMO FO O MS CHRO/CMO FO O MS COO RO S GA COO RE S GA CFO RE S BD COO RO O GA COO/CIO RE O BD COO/CIO RO O GA COO/CCO RO T BD COO RO O GA COO RE S BD COO RO O BD COO RE O GA COO RE O GA COO FO T GA COO RO O GA COO RE S BD CIO RE O GA COO RE/RO O GA CFO/COO FO S GA CFO/COO FO S GA CFO FO S OS CFO RE O OS CFO FO O OS CFO RO O OS CFO RE T OS CFO FO O OS CFO FO O BD CFO FO O OS CFO FO T GA CFO FL/RE O GA CFO FO T GA CFO FO O OS CFO/CPO FO S GA CFO/COO FO O BD CFO FO S GA CFO RO S GA CFO/COO FO S GA COO/CIO FL O GA COO/CIO FO O GA COO/CFO RO S GA COO FO O GA COO FO O GA COO FO T GA CRDO RE O BD COO RO O GA COO FL O GA COO FO O GA COO FL T GA CSO FO S GA COO FL O GA CIO RE O IT CIO RO O IT CIO FL O GA CFO/COO FL O GA CFO/CIO FO O GA CFO/CIO FO S GA CFO/CIO FO/RE S GA CFO FL O GA CFO RE O GA CFO FL S GA CIO FO T IT CFO/CIO FO O IT CFO RO O GA CIO RO S OP CIO FO T IT CIO FO O IT CIO FO O IT CIO FO/RE O IT CFO FO S GA CMO FL/RE O MS CMO RE/RO T BD CFO FO T MS COO/CMO RE T BD COO/CIO FO T BD COO RE/RO S BD CMO FO T GA CMO RO O BD CFO/CRSO FO/RO T BD CFO/COO FO/RE T OP CFO/COO RE O BD CFO/COO RE T BD CFO/COO RE T GA CFO/COO RE O GA CFO/COO RE T BD CFO/COO RO T OP CFO/COO RE O GA CFO/COO RE T BD CFO/COO RO T GA CFO FL T GA CFO RE T OP CFO FO T GA CPO RO O GA CPO FO T OP CIO FO T GA CRSO RO T BD CFO RO S BD CRSO RO T OP CRSO RO O GA COO/CIO RO S BD CIO/COO RO S BD CHRO/CIO RO S BD CFO/CIO RO S BD CFO/CIO RO S GA CFO RO T BD CFO RO T BD CFO RO T BD CFO RO O BD COO FO O BD CPO/CRSO RO S BD CFO/COO RO T BD CFO/COO RO O GA CFO/COO RO O BD CFO/COO RO T BD CFO/COO RE S BD CFO/COO FO T GA CFO RO O GA CFO RO T OP CRSO/CFO RO S BD CIO RO O GA COO RE O HR CHRO RE O HR CFO/CMO FO S BD CFO FO S GA CRSO/COO RO O BD CRSO/CIO RO O BD CRSO RO T BD CRSO RO O BD CRSO RE T BD COO/CFO RE O GA COO FO O GA COO FO T GA COO RO O GA CFO/COO FO O GA CFO/COO FO O GA CFO/COO FO T GA CFO/COO RE O GA CFO/COO FO T GA CFO/COO FO O BD CFO/COO FO T BD CFO/COO RO T GA CFO/COO RE O GA CFO/COO RO T GA CFO/COO FO S GA CFO/COO RO T BD CFO/COO FO S GA CFO RO T BD CFO FO O BD CFO RO T GA CFO RO T GA CFO FL O GA CFO RO O BD CEO RO O BD CCO RO O BD COO RO T BD COO RO O BD CFO/COO/CPO FO O OS CRSO RO O GA CFO/COO RE O HR CFO/COO RE O HR COO RE O HR CRSO RO S BD CRSO RO S BD COO/CIO RO S BD COO RO O BD CFO/COO FO S BD CIO RO O BD CIO RO O BD CIO RO O BD CIO RO O GA COO RE T BD COO FO T GA COO RE T GA COO FO O BD COO RO T BD COO RE T BD COO RE T BD COO RO O BD COO RE T GA COO RE O OS COO RE O BD COO RE O BD CHRO/CPO FO O GA COO RE O BD COO RE T BD COO RE O BD COO RE O BD COO RE T GA CHRO/CRDO FO O GA CPO FO O BD CPO FL O BD CPO FL O BD CPO FL O BD CPO RE O BD CTO RO O GA COO FO S BD CMO FO O BD CRDO RE O BD CPO RE O OS CPO FO O BD COO/CRDO RE O BD COO RE O OS COO FO T OS COO FL O OS COO RE S OS COO FO O OS COO FO O OS COO FO O OS COO RE O OS COO RE O OS COO RE T OS COO RE O OS COO RE T GA COO RE O GA COO FO O MS COO RE O MS COO RE T GA COO RE O OS COO RE O HR COO RE S HR COO RE T BD COO FO O OS COO RE T GA CMO FO O OS CRDO FO O OS COO RE T OS COO FO O OS CPO RE O OS CPO FO O OS CPO FL O OS CPO RE O OS CPO RE O OS COO FO O OS COO FL O GA COO FL O GA COO FO S OS CFO/COO FO S GA COO RO O GA COO RE O OS CRSO RO O GA CRDO RE O OP CPO/CIO RE O OS COO FO O GA CIO RE O MS CIO RE O MS CHRO/CIO RE T GA CHRO/CIO RE O BD CHRO RE O GA CHRO FL O GA CIO/COO RE O GA CFO/CIO RE O GA CFO RO T GA CFO RE/FL O GA CFO RO O GA CFO RE/FL O GA CFO RE O OS CFO RO O BD CFO RO T GA CFO RE O GA CFO RO O OS CFO RE O OS CFO RE/FL O OS CFO RE O OS CFO RE S GA CFO RE O OS CFO RE O GA CFO RE O GA CFO RE O GA CFO RE O GA CFO RE O GA CFO RE O OS CFO FO O GA CFO FO O GA CFO RE O GA CFO FL O OS COO RE O GA COO RE T GA CPO FO O OS CPO RE O GA CPO RE O OS CPO RE O MS CPO FL O GA CPO FO T OS CPO FL O GA COO FL O OS CIO FL O OS CHRO/CPO RE O GA CFO/CIO FL O OS CIO/CTO RO O GA CIO RO O BD CIO FO O GA CIO RE O GA CIO RE O GA CHRO/CIO FO O GA CHRO RE O HR CHRO/CIO RE S HR CHRO/CMO RE O HR CHRO/CMO RE O MS CHRO/CMO FO T MS CHRO/CMO RE T MS COO/CHRO FO O BD CHRO/CPO RE O HR CHRO FO O HR CHRO FO T HR CHRO FO O IT CHRO RE O HR CHRO FO O HR CHRO RE O HR CHRO/CRDO FO T BD CHRO/CRDO RE O HR CHRO/CMO FO T MS CHRO/CPO RE O OS CHRO/CRDO RE O HR CHRO/COO RE O HR CHRO/COO RE O HR CHRO/CMO RE/RO O HR CHRO/CIO RE T HR CHRO/CIO RE O HR CHRO FO S HR CHRO FO T HR CHRO FO O HR CHRO FO O HR CHRO FO O HR CHRO FO T HR CHRO RO O HR CHRO RE O HR CHRO RE O HR CHRO RE O HR CHRO RE O HR CHRO RE O HR CHRO RE O HR CHRO FO T HR CHRO RE O HR CHRO RE O HR CHRO FL O HR CHRO FO O HR CEO/CHRO RO O HR COO FO O BD CFO FO S GA CFO/CMO FO T MS CFO/CMO FO T MS CFO RO T MS CFO FL O MS CFO FL O MS CFO FL O MS CFO RO O MS CFO RE T OS CFO FL O OS CFO RO O OS CFO FL O OS CFO FO/FL O BD CFO FO S GA CFO/CPO FL O MS CFO RE T GA CFO FL T GA CFO FL O OS CFO FL O OS CMO/CIO RE O IT CFO/COO RO T IT CFO/COO RO T IT CFO/CIO RO T IT CFO/COO FO O IT CIO RO O IT CIO RO S IT CIO RO O IT CFO/COO/CIO RO O IT CFO/COO FO O IT CFO/COO RE T IT CFO/COO RO S IT CFO/CIO RO T IT Responsible C-level Executive C-level executives perceive the challenges their company faces differently, yet one thing they have in common: a general need for knowing exactly which IT invest- ments to prioritize in order to realize most possible value. Gain market share while others recover from external shocks Penetrate new markets better and faster through channel partners Enter new segments and markets Improve account management strategies Refocus and/or refine priorities and strategies Improve cross-sell and up-sell campaigns Tailor sales approaches to customer segments Target new segments within current geographies Increase focus on high value/high potential customers Strengthen customer base Increase focus on most effective sales and advertising channels Increase sales by guaranteeing 24/7/365 100% availability Improve identification of cross-sell/up-sell opportunities Improve understanding of sales and production defection drivers Tailor account manage- ment approaches to customer segments Increase sales to existing customers Improve identification of valuable customer relationships Improve understanding of weakest performances Target new geographies Expand sales and advertising channels Improve quality and assignment of sales leads Improve methods and tools to manage sales performance Faster go-to-market with new products and services Tailor products and services to new customer segments CFO RO S GA Increase stock value by adopting sustainability strategy Align advertising with pricing strategies Convert free services to fee-based services Charge higher prices dynamically Improve focus on price-insensitive customer segments Improve tailoring of offerings to customer needs Improve data on customer price sensitivity Receive premium for 24/7/365 100% availability Align product and service prices with value to customers Coordinate pricing of complementary products and services Improve execution of market- and supply driven promotions Improve structuring and pricing of promotions Improve understanding of product/service value to customers Increase emphasis on differentiated products and services Increase focus on pricing effectiveness/price optimization Increase use of differential pricing mechanisms COO RB O OS Reduce cost of correlated energy/water management Consolidate or outsource procurement functions Refine vendor strategies Consolidate or outsource IT design and develop- ment functions Consolidate or outsource IT design, development and deployment services Consolidate or outsource end-user-support Consolidate or outsource operations and maintenance services Consolidate or outsource benefits administration functions Consolidate or outsource learning and development functions Consolidate or outsource recruitment functions Improve alignment of business unit and enterprise strategies Improve alignment of organization structures with business strategies Consolidate or outsource payroll functions Consolidate or outsource property management functions Improve alignment of financial and corporate strategies Outsource property tax administration activities Bypass current channels/ sell directly to customers Improve focus on segments with lower average cost-to-serve CFO FO T GA Reduce travel expenses CSO FO S GA Increase focus on business insight and and forward- looking information COO FO T GA Increase transparency of energy management of buildings, manufacturing, datacenter and logistics CFO RO O GA Reduce cost on energy management of buildings, manufacturing, datacenter and logistics Rationalize targeted markets and customer segments Rationalize customer portfolio Rationalize targeted customer segments Select and enter profitable and exit non-profitable markets Consolidate order fulfillment functions Increase focus on business insight and forward-looking information Minimize recovery costs through “self-healing” capabilities Improve focus on higher-value advertising channels/media Increase use of lower-cost sales channels Minimize recovery costs Better alignment of business planning, management and reporting functions Minimize costs related to external shocks Consolidate company real estate/facilities Improve alignment of capital budgets and program plans with business priorities Increase use of lower-cost billing channels Increase use of lower- cost real estate and facilities/Relocate business operations Reduce fixed cost by paying for usage, not for availability Strengthen enterprise- wide financial reporting standards Design product for ease-of-use/self-service Improve emphasis on design for packing/ shipping efficiency Standardize product catalogs Consolidate service and support operations Consolidate or outsource product development functions Refine vendor/supplier strategies Refine/align logistics and distribution strategies Refine and/or align material strategies Consolidate/outsource logistics and distribution functions Consolidate or outsource production functions Consolidate or outsource service and support operations Improve focus on higher-value customer segments Increase emphasis on designing and packaging for distribution Increase emphasis on designing for material efficiency Increase emphasis on modular, extensible, scalable designs Reduce peaks in operating costs Increase focus on materials-efficient production mechanisms Reduce operational costs through efficient resource allocation Increase emphasis on designing for service efficiency and self-service Rationalize and/or realign product development efforts Design products to use cost-effective materials Improve focus on higher-value products COO FL T GA COO FL S GA COO RO T GA COO FL S GA Consolidate or outsource property management functions Improve alignment of financial strategies with corporate strategies Improve balance between buy and lease Reduce asset ownership Increase emphasis on service prevention and reduced need for service Increase use of cheaper service channels Rationalize and/or refocus product and service portfolios Improve purchasing on a national/global basis Rationalize/consolidate vendor portfolio Acquire companies in target geographies Acquire companies with relationships in targeted customer segments Accelerate or defer income/expenses Consider tax implications in the location/selection of facilities Develop and utilize unique tax expertise Ensure adequate documentation of significant tax positions Ensure full utilization of tax carry forwards Improve accuracy and timeliness of tax provision and cash outflow forecasts Improve management of transfer pricing Optimize accounting methods and selection of accounting periods Optimize depreciation methods/lives for pro- perty, plant and equipment Optimize expense vs. capitalization of costs Optimize valuation and costing methods for inventories Exploit investment management make and buy options Improve ability to develop and spin-off new businesses Decrease ownership of non-differentiating assets Defer/change timing of capital investments Leverage existing invest- ments better Optimized asset related costs Reduce number of data centers, branch offices, dealerships, retail outlets, etc. Minimize unprofitable investments Divest low-utilization equipment License or sell intellectual capital to other enterprises Improve effectiveness of plant maintenance Improve design for manufacturability and service Improve preventive equipment maintenance Increase use of leased production equipment Increase utilization of production equipment Rationalize production facilities Streamline business model with focus on core business components Minimize unprofitable, fixed contracts Better integration of legacy and new solutions Optimize harmonization and consolidation Optimize infrastructure costs Optimize utilization of facilities Divest low-utilization infrastructure Increase use of leased infrastructure Reduce total cost of travel management Better exploitation of variable cost reduction opportunities Improve balance and cash flow management between buy and lease Reduce asset ownership Improve terms on IT systems Improve terms on infrastructure Improve terms on property and facilities Consolidate IT systems, production lines and service mechanisms Divest low-utilization IT systems Improve maintenance of IT systems Increase utilization of IT systems Utilize more efficient IT systems Establish development of strategic assets as a key competency Better alignment of financial accounting and analysis functions Withdraw non-profitable products Improve emphasis on product quality and ease of service Rationalize and/or refocus service portfolios Retarget products and services and manage pricing Consolidate billing operations Manage procurement for MRO on a national/ global basis Rationalize/consolidate MRO vendor portfolio Consolidate IT, telephone and network equipment and facilities Implement integrated applications across organizational boundaries Rationalize IT application portfolio Improve HR practices Improve focus on employee retention COO FO O GA Improve cost savings by reducing waste, energy and water usage CFO FO O GA Improve sustainability management reporting and balance sheet Increase use of lower-cost logistics and distribution channels CIO FO S IT CFO FO S GA CFO RE S GA CFO FO O GA COO FO O OS Leverage IT investments better Improve management of credit/loan portfolio Improve cash flow Improve management of credit risk and payments across business units CIO FL O IT Optimize IT infrastructure cost CIO FO O IT CFO FO/RE S GA CFO FO/RE T GA CFO RO S GA Divest low-utilization of IT infrastructure Reduce total cost of facility management COO RE T GA CSO FL S BD Improve project performance Adressing global issues ie. climate change with sustainability management CSO FL S BD Improve eco-efficiency initiatives to increase cost savings CSO FO S BD CFO FO S BD Improve sustainability stra- tegy based on economic profitability, environment and social responsibilities Adopt social and ethical responsibilities in corporate strategy Reduce total cost of project management Maximize shareholder and corporate value by sound economic sustainability activities Reduce cost adoptions sustainability management in day-to-day business operations CFO FL T GA Strengthen enterprise- wide financial reporting standards Increase use of lower-cost production channels Improve tax benefits of compensation and benefit programs Improve platform and portfolio strategies for products and services Improve competitive research Improve quality of consumer analysis Better patent processes Improve design and development approaches Improve methods and tools for managing innovation performance Pursue joint-venture, partnership and OEM arrangements Improve integration of research & development Better settings for innovation to flourish Improve management of product lifecycles Increase emphasis on design for configurability/ customization Increase focus on R&D, product innovation, and product leadership Increase utilization of modular, reusable designs Broadened product and service offerings More attractive products and services Reduce research & development time through collaboration Improved market intelligence Optimal collaboration across the value chain Improve design and development processes Improve ordering and receipt processes Improve product develop- ment performance mana- gement, methods & tools Improve profitability of R&D efforts through utilization of economic development incentives Improve product prototyping, piloting and testing processes Improve project management Improve utilization of product development channels Increase number and quality of product and service launches License or acquire products and intellectual property Improve balance between core and none core activities Improve flexibility across the value chain to match new demands Improve responsiveness to customer requests and inquiries Improve risk protection and management Build flexible business architecture and infrastructure Increase use of flexible production facilities Improve responsiveness across the value chain Build flexible and scalable business infrastructures Optimize working capital by applying flexibility in internal activities Better balance between standard and customized applications Utilize more flexible/ expandable IT systems Flexible IT architecture and infrastructure Increase use of flexible and expandable infra- structure Consolidate/realign sales territories Route low-value trans- actions to lower-cost sales channels Improve account manage- ment methods and tools Improve channel manage- ment, processes and tools Improve cross-sell and up-sell approaches/ models Improve effectiveness of cross-sell and up-sell approaches/models Improve field sales and telesales processes Improve processes for rating, qualifying and assigning leads Improve relationship/ account development processes Improve terms with advertising channels Improve terms with sales channels Improve transparency of customer, product and channel profitability Provide staff with better customer information Provide staff with better market information Improve order manage- ment methods and tools Improve capacity/demand planning processes, skills and tools Improve due-date reliability Improve forecasting, planning and prioritization skill and tools Improve pick, pack and ship processes Improve policies and pro- cesses around material returns Improve provisioning/ installation processes Improve routing of service requests to appropriate staff Improve workforce planning and dispatch processes and tools Improve sales perfor- mance management methods and tools Provide staff with better customer and order information Improve campaign design and management pro- cesses and tools Improve sales forecasting and campaign execution processes and tools Improve incentives around order management efficiency Improve incentives around service efficiency and effectiveness Improve credit analysis processes Improve invoicing/billing processes Improve services and delivery Develop stronger customer relationships Establish customer communities Improve customer service Improve responsiveness to customer complaints/ feedback Improve tracking of customer interactions Improve understanding of current customer satisfaction Improve understanding of customer needs Increase emphasis on account/relationship development Solicit and respond to customer feedback Improve effectiveness of sales processes Improve quality of products and services Improve marketing strategy Tailor marketing ap- proaches to customer segments Develop and cultivate good will Develop and leverage strong brand Improve effectiveness of marketing and advertising processes Improve brand aware- ness/elevate brand image Improve marketing and advertising performance management methods and tools Rationalize and/or refocus channel/media usage Improve brand strength and good will Optimize marketing channels Apply brand to new and unbranded products Improve staff incentives around marketing efficiency Improve relationship management strategies for key stakeholder groups Increase proactive pursuit of partnerships, mergers and acquisitions Increase focus on partnership, merger and acquisition opportunities Partner with best-in-class partners on non-differen- tiating elements Improve quality and speed of communication with partners Improve communication with stakeholder groups Improve quality of infor- mation provided to stakeholders Develop and leverage strong/unique partner relationships Improve ability to identify and assess partnering opportunities Improve ability to turn strong relationships into competitive advantage Improve identification of stakeholder groups and establishment of priorities Improve integration of business processes across partner networks Improve understanding of partner strengths, weaknesses and interests Improve value delivered to employees, partners, and other stakeholders Increase emphasis on operational integration with partners Improve ability to integrate merged and acquired organizations Improve integration of IT systems across partner networks Better match of trends and buying patterns Improve tracking and recovery of indirect taxes Improve customer service and support processes Improve service and support performance management methods and tools Improve utilization of customer service staff Shorten order-to-delivery cycle time/Improve product and service availability Improve definition of product and service specifications Improve product and service withdrawal and retirement processes Provide staff with better product, service and competitive information Improve staff incentives around sales efficiency Reduce business risk by aligning with changing market needs Reliable customer intelligence Improve identification and prediction of industry and market trends Secure use of information that is accurate and real-time Provide greater predict- ability in performance Improve access to infor- mation and analytical tools Improve analytical processes and tools Improve identification of opportunities and threats Improve cost transparency Improve access to and distribution of perfor- mance information Improve analysis of managerial information Improve assessment and benchmarking of business process performance Improve breadth, depth, quality and timeliness of business information Improve determination of key performance metrics and targets Improve measurement and reporting of opera- tional and financial performance Improve tracking and communication of program/project progress Increase emphasis on continuous, proactive performance management Increase focus on key performance metrics Drive greater financial predictability CRSO RO O BD CRSO RO O BD COO RE T BD COO RE S GA COO RE T OP Improve alignment of projects with program and business objectives Continuously track and manage the realization of project benefits Improve coordination and communication across programs and projects Structure programs and projects to deliver benefits progressively Cost reduction with waste management Improve benchmarking of global effective tax rate against industry peer group Improve identification assessment and execu- tion of M&A/divesture opportunities Improve quality and con- sistency of performance assessment methods Improve use of balanced scorecard Optimize investment in accurate analytics and decision support tools CSO RE T GA Provide greater predict- ability with accurate envir- onment health and safety business process flows Identify organization's limits and weaknesses Improve anticipation and understanding of current and potential regulation/ legislation Improve monitoring and management of risk and compliance Improve physical security of people Optimize compliance with environmental standards Optimize compliance with industry standards Optimize compliance with health standards Improve data and privacy protection compliance Optimize compliance with accounting standards Ensure tax planning activities and tax filings comply with regulatory environment Improve focus on internal controls and regulatory compliance Improve monitoring and management of regulatory compliance Improve understanding of regulatory requirements Minimize risk by increasing expertise in selected activities and markets Increase emphasis on risk-informed, scenario- based planning Improve/implement internal control frame- works and policies Improve accountability/ authority of program and project resources Improve effectiveness of governance models Improve effectiveness of program/project governance models Improve integration of short- and long-term business planning Improve structuring and launch of cohesive program portfolios Clarify governance roles and responsibilities Improve assignment of accountability and authority Improve incorporation of risk analysis in business planning Increase use of Service Oriented Architecture Improve effectiveness of organizational structures Build values and ethics into corporate culture Improve alignment of customer, product, sales, service, support, and fulfillment strategies Improve alignment of budgets and capital programs with strategic priorities Effective and efficient risk management procedures Improve protection of sensitive data and intellectual property Improve company-wide monitoring and manage- ment of risks Improve identification and assessment of risk Increase emphasis on risk identification and management Improve post-merger synergy and cost reduction programs Strengthen cross-business- unit and cross-company collaboration Increase emphasis on quality management and benchmarking Reduce operational risk Continuously track and manage the realization of project benefits Dynamically cancel or redirect ineffective/ obsolete programs and projects Improve alignment of projects with program and business objectives Improve coordination and communication across programs and projects Improve coordination of investment, financial and tax strategies across business units Improve development and analysis of business cases Improve focus of company resources on high-priority initiatives Improve identification and management of program/project risks COO RE T OS CRDO/COO RO O OS Anticipate future energy and water management cost Improve corporate social responsibilities and ethical value management Improve program/project management methods and tools Improve risk planning, mitigation and control approaches Increase emphasis on enterprise-wide program planning and delivery Strengthen corporate governance structures Structure programs/ projects to deliver benefits progressively Align internal audit practices with business and risk objectives Improve effectiveness of legislative/lobbying efforts Improve monitoring and protection of assets, people, infrastructure, etc. Increase accountability of business unit leader for tax impact of decisions Lower debt burden Strengthen and commu- nicate governance policies and procedures Strengthen and commu- nicate mission, vision, values and ethics Improve communication between the board, mana- gement, shareholders and the public COO RE O OP Reduce cost with predict- able greenhouse gas emissions to comply with regulation cap COO RO T GA Improve environmental disaster and recovery prevention plan Improve quality assurance programs Optimize risk management across products and services Improve management of vendors/service providers Improve security of applications, systems and data Improve communication around improvement priorities Improve management of organizational change in support of initiatives Improve communication of strategic directions and priorities Effective business continuity roadmaps More effective damage handling roadmaps Establish recovery and maintenance plan Redundancy in key parts of the operational model to ensure continuity Improve business continuity planning Effective and efficient back-up systems Efficient fall-back systems Efficient recovery solutions Improve performance and reliability of IT systems/platforms Improve capacity planning processes, skills and tools Improve coordination with business partners Improve demand fore- casting processes, skills and tools Improve incentives around production efficiency Improve manufacturing and quality control processes Improve production per- formance management methods and tools Improve production scheduling and staging processes Improve utilization of production channels/ reduce downtime Provide staff with better production information and tools Rationalize order quantities and timing Rationalize production quantities and timing Shorten production cycles Improve incentives around procurement efficiency Improve materials efficiency of production processes Improve materials per- formance management methods and tools Improve product and service introduction/ launch processes Improve product concep- tion initiation processes Provide staff with better product information and tools Improve incentives around product development efficiency Improve collaboration with vendors Improve terms on equipment purchases Improve terms on materials purchases Improve terms with pro- duction service providers Reduce procurement cycle times COO FL O GA Identify hidden cost on process level to reduce waste, production material and energy/water usage Better technology exploitation COO RO O BD COO/CRDO RO O BD CRDO/COO RO O OS CRDO/COO RO O BD End-to-end product trace- ability, impact analysis, response Decrease carbon footprint in product and service life cycle Improve product compliance analysis and reporting CRDO/COO FL T OS CSO FO S OS Improve environmental- friendly products and services Define business model for sustainability that incorpo- rates economics, environ- ment and social aspect CCO/COO FO S OS Improve sustainability partnership in product life cycle and services COO RO O BD Improve environmental footprint calculation ie. carbon and water footprint Improve product safety with sustainability management Develop low-inventory business models Differentiate treatment of customers/segments Increase emphasis on designing for efficient materials management Rationalize material order quantities and timing Rationalize raw materials Increase emphasis on designing for operation efficiency Align operation and ma- terial ordering schedules with distribution schedules Better inventory control Divest low-demand/ obsolete inventory Improve capacity/demand planning, processes, skills and tools Improve design/structure of distribution networks Improve incentives around inventory/distribution efficiency Improve incentives around material efficiency Improve inventory receipt and storage processes Improve logistics/ distribution efficiency Improve logistics per- formance management methods and tools Improve material ordering and receipt processes Improve material per- formance management methods and tools Improve retrieval processes Improve routing of service requests to appropriate service channels Improve service and support processes Improve service perfor- mance management methods and tools Improve transport and delivery processes/ algorithms Improve utilization of logistics service staff Improve workforce planning dispatch and assignment of processes and tools Increase emphasis on build-to-order Increase utilization of standardized components Provide staff with better product, service and contract information Route low-value trans- actions to lower-cost service channels Increase emphasis on use of common components Increase emphasis on high-turnaround products Rationalize and/or refocus material portfolio Improve coordination with vendors Improve focus on higher- value vendor relationships Improve terms on material Improve use of national/ global purchasing power Increase use of just-in- time procurement Improve collaboration with vendors/partners Improve terms on leased service assets Improve terms with logistics service providers Increase use of vendor- managed/vendor- warehoused inventory CHRO/CFO RE S HR CFO RO O GA CFO RE S GA Improve budgetting and forecasting capabilities Communicate HR strategies Improve breadth, depth and quality of financial information Improve strategic planning processes Improve selection, acqui- sition and contracting processes Improve faster and smarter decision making process Improve operational risk management processes Improve design, development and testing processes Improve procurement performance management methods and tools Maintain strict control of differentiated components Improve end-user application support Improve establishment of and adherence to service-level targets Improve HR performance management methods and tools Provide staff with better HR information and tools Improve performance assessment processes Utilize available govern- ment and local employ- ment/training incentives Improve program management processes Provide staff with better managerial information and tools Improve accounting and measurement processes Improve asset manage- ment processes Improve audit and com- pliance management processes Improve breadth, depth and quality of financial information Improve budgeting and forecasting capabilities Improve business case development and analysis processes Improve business performance reporting processes Improve capital budgeting processes Improve compliance management processes Improve debt and equity management processes Improve financial reporting efficiency Improve financial risk management processes Improve incentives around business planning efficiency Improve management of indirect taxes Improve payroll processes Improve real estate design and development processes Improve real estate im- provement and deploy- ment processes Improve real estate per- formance management, methods and tools Improve real estate selection, acquisition and contracting processes Improve tax management processes Improve utilization of telecom tax incentives Increase utilization of real estate Manage payroll tax impacts of business initiatives COO RO O OS CIO RO O OS Integrate management of economics, society and environment in daily operations CHRO RO T HR Improve employee owner- ship to harness ideas to improve cost savings through sustainability Improve green IT cost reduction initiative Optimize utilization of available sales/use tax exemptions Improve installation/ deployment processes Provide staff with better product and service information Improve collaboration with vendors CMO/COO FO T OS Improve workplace environment and corporate services with sustainability Improve contract mana- gement processes Improve product procure- ment processes Improve service procure- ment processes Improve terms on equip- ment and supplies Increase focus on higher-value vendor and partnerships Utilize national/global purchasing power Improve terms with third-party product and service providers Improve terms with cor- porate service providers Improve incentives around MRO procurement efficiency Improve terms on pur- chased and leased assets Improve technology and data risk management processes Avoid expensive recovery investments Consolidate device management information and tools Improve/consolidate IT performance management methods and tools Increase utilization of IT, telecom and network resources Improve incentives around IT/network efficiency Improve salary and benefits administration processes Improve alignment of HR and technology strategies with business strategies Improve account mana- gement skills of staff Improve cross-selling/ up-selling skills of staff Improve incentives for account/relationship development Improve staff incentives for cross-selling/up-selling Establish process impro- vement and innovation as key competencies Improve vendor manage- ment skills of staff Develop and maintain better competencies Improve incentives around asset development Improve knowledge sharing Improve mechanisms for collecting and implement- ing employee ideas Improve monetary and non-monetary recognition of staff contributions Improve training processes Improve incentives for product development and innovation Improve product- and service-innovation skills of staff Build product margins/ profitability into sales Improve contracting and negotiation skills of pro- curement/purchasing staff Improve skills of product development staff Improve skills of order management and billing staff Improve skills of produc- tion staff Improve skills of sales and marketing staff Implement/improve company-wide processes and tools for assessing staff performance CHRO FL S HR CHRO FL T HR CHRO FO T HR CHRO RO T HR CHRO RO S HR Identify strategic HR needs Engage employees in sustainability strategy and execution Manage employee performance Improve employee resourcing requirements per unit/organization Engage employees in sustainability strategy and execution CFO/CHRO FO/RO S HR CHRO FO/RO T HR Determine HR costs Improve employee benefits Improve technical and project management skills of staff Align compensation and incentive systems with strategies, values and ethics Align management and staff incentives with company performance Improve ability to attract talent Improve resource and skills performance management Build innovation and improvement into rewards and incentives Improve employee per- formance and satisfaction evaluation Improve executive deve- lopment, recruiting and succession planning Improve partnership and collaboration skills of staff Improve program/project management skills of staff Improve recruitment and orientation processes Improve skills of HR staff Improve skills of inventory and distribution staff Improve skills of service staff Improve staff incentives around service efficiency Improve talent manage- ment models and pro- grams Increase emphasis on people/talent development Increase use of distance/ on-line learning Manage employee churn Improve leadership and management skills of executives Develop, spin-off and sell new business Refine credit/days- receivable strategy Increase focus on costumer segments with loss credit/loan needs Increase focus on credit- worthy customer segments Differentiate credit treat- ment of customers/ segments Improve and standardize credit assessment processes Improve collections processes Improve management of credit/loan portfolio Tighten credit/loan terms Optimize management of A/R and A/P across business units Improve cash flow Improve management of credit risk across business units Leverage credit rating to lengthen payment cycles and reduce interests rates Reduce capital require- ments through partnering Reduce level of working capital Increase focus on vendors with favorable payment terms Improve assessment and benchmarking of A/P performances Improve coordination of payments across business units Improve management of debt portfolio Leverage breadth of vendor relationships to lengthen payment cycles Collaborate with customers on data synchronization Improve data control processes and tools Improve data harmoniza- tion processes and tools Better data and privacy protection compliance Collaborate with supplier on data synchronization Better master data harmonization Consolidate and/or re- architect data stores Optimize master data consolidation Build master data with fully controlled redundancy Improve data quality Optimize use of real-time data Strengthen data harmo- nization and consolidation Improve data transparency COO FL T GA Outsource property tax administration activities CSO FO T GA CMO FL S MS CMO FL S MS Improve competitive differentiation with “green” and low-carbon products Increase environmental- friendly products & services that replace demand for non- green products & services Enhance eco-efficiency, social responsibility and well-balance sustainability growth plan CCO FL T BD Improve supplier transparency on product- related emission CCO FO S BD Improve competitiveness through sustainability win-win partnership CMO FO T BD COO RO O GA COO FL S GA Improve sales and service performance management methods and tools Adopt sustainability business model CMO RE T MS CMO/COO RE T MS CMO FL T MS CMO FL T MS Benchmark sustainability management Improve customer satisfaction with environmental-friendly products and services Raise internal/external consciousness of sustainability management Improve recycling and reclamation CMO/CHRO FO S MS CMO FO T MS CMO FO T MS CMO FO T MS Improve communication of sustainability vision, strategy, programs and activities Improve transparency on product-related emission Increase brand value with sustainability messaging Improve engagement in social community sustainability COO/CRSO RO O OS CSO/CFO RE T OP COO FO T OS COO FO T OS Comply with local green- house gas emission cap and trade systems Comply with environment industry norm and standards Adopt practical recommen- dations from the climate change convention Embed sustainability compliance controls throughout the value chain CFO/CHRO FO/RO T IT CBDO FO/RO S IT CIO FO/RO S IT CIO RE/RO S IT CIO RE/RO S IT CFO FL O GA CFO FL O IT Improve HR measures on systems Build strategic intelligence Improve standards, guidelines and principles Improve IT architecture and align with enterprise architecture Improve IT governance standards and processes and align with process governance and business Continuous improvement of sustainability manage- ment ie. measuring Improve diagnose and evaluation process of sustainability management Capture new customer segments with sustain- ability products & services CMO FO S MS © Value Team ApS www.valueteam.biz About the Authors Color Codes for Processes Express Value Creation Business Value Tree Abbreviations used in the Code Bar Business value – the driving force? Business value planning, identification, creation and realization, is probably one of the most common dilemmas and challenges confronted by companies today, regardless of factors such as size, revenue, indus- try, region or business model. The Business Value tree is a powerful tool designed to accelerate the connection not only between Business Model and ones Business Processes, but between the needed link of Service Orientation, Enterprise Architecture, Value Management and Performance Management. Working with Value drivers is not rocket science and it is not difficult, but rather some- thing that can jump starts the process of focusing on the things that matter most, and then choosing practical ways to get them done. The Express value creation approach we follow to plan, create and realize value is described below: CEO = Executive CFO = Financial COO = Operation CMO = Marketing/Sales CIO = Information CTO = Technology CSO = Strategy CCO = Channel CPO = Procurement CHRO = Human Resources CRSO = Risk & Security CRDO = Research & Development CBDO = Business Development Business Model Competencies Business Competencies, defined as business areas with characteristic resources and capabilities. GA = General Administration HR = Human Resource IT = Information Technology BD = Business Development OS = Operations Support OP = Operations DI = Distribution MS = Marketing, Sales & Service Business Model Level Operational level characterizes the scope of decision making. S = Strategic (about strategic decisions, overall direction and policy) T = Tactical (about monitoring, control, managing exceptions and tactical decisions) O = Operational (about doing the work) Business Model Imperatives A business accelerates value by connecting and service enabling business competencies with suppli- ers, partners and customers to focus and respond rapidly in a focused, flexible and robust manner to any opportunity or threat. FO = Focused RE = Responsive FL = Flexible RO = Robust Author: Prof. Dr. Mark von Rosing As the Managing Director for Value Team ApS, specialized in strategic management and market analysis, Prof. Mark von Rosing has been serving the top 5 consulting companies and many of the fortune 500 companies over the years. He is in every way an entrepreneur with a proven track record for delivering results. Worth mentioning is: • He just received IBM’s prestigious “Growth Award 2009” for contributing as the strongest growth enabler across EMEA • The Co-developer of SAPs global Business Process Management Framework and approach • Designer and co-developer of the new SAP BPX certification program for associate and professional • Main author of SAP Press New Business Performance Management book on Applying real-world BPM in an SAP environment • Author of numerable publications in the area of Business Model Management, Business Process Management, Value Management & Sustainability • Head and founder of the Global University Alliance BPM and Enterprise Architecture curriculum program (consist of 900 Universities) • Member and co-developer of the Global TOGAF Business Architecture development Group • Founder of the Global BPM Roundtable/User Group, which consists of over 200 companies Mark is a Professor in Business Model Management, Business Process Management and Value Management at the Copenhagen Business School and IT University, Denmark, lecturing on both Bachelor and Masters level. He has coached and helped numerable companies create and realize value. His developed approaches within Business Modelling, Process Management and Business Value Management, has helped hundreds of companies over the world. Contact information: E-mail: [email protected] or Phone: +45 28 88 89 01 Strategic Processes Customer Processes Internal Processes Product & Service Processes Supplier Processes Technology Processes Organizational Processes Sustainability Processes Express Value Creation is a consultant-led approach aimed to help prioritize and align IT investments – to realize values that matter the most in reaching strategic business objectives – both short and long term. This concept has proven to be an important differentiator when planning, identifying, creating and realizing the wanted value. With a holistic view – taking all major business and technology perspectives into consideration – Express Value Creation provides rapid execution and return on investment, enabled by a focused approach, a streamlined roadmap, and power- ful tools. This will not only build a powerful tool for value planning, identifica- tion, creation and realization in developing the ability to analyze, define, standardise, optimize or innovate ones competencies, but also the underlying processes and activities. Through this approach the company’s competencies become stronger and more difficult for competitors to understand and replicate. A successful value creation approach requires more than just a proven methodol- ogy. A number of elements needs to be considered, concentrating on the four pillars: 1. Strategic alignment - The approach should be adapted and streamlined for the company to ensure value creation in the strategic planning workshop sessions, where a business model is built with all the different competencies (resources and capabilities) which produce internal and external values are mapped with the company’s management models, Corporate Strategic Business Objectives (SBO’s), Critical Success Factors (CSF’s), and the different value opportunities. 2. Organizational alignment - Once core competencies (Differentiated and Competitive) are defined the service enablement that needs to support the differentiated and competitive competencies is identified, and Performance as well as Monitoring needs are outlined. 3. Technology alignment - The efficient execution of processes in todays corporate world is largely dependent on IT systems supporting an administration, production and operating model. Additionally, an effective and efficient approach should use an optimal mix of technology to support each phase. 4. Processes alignment - Define process activities with static and dynamic simulation and optimization (define KPI’s and PPI’s) and apply your IT’s composite application process characteristics (including service definition) as well as define monitoring and measurements. The mentioned alignment always relies on effective and efficient integration of organization, technology and processes, but many organizations do not have a clear link between the four key pillars. An organization’s strategy may be gaining a competitive advantage, innovation, growth, acquisitions, differentiation, increasing profitability, or gaining market share, meanwhile all of these strate- gies require suitable business competencies that are embedded in adequate orga- nizational structures and aligned with the processes and supported by people and technology. In this unique approach you will not have to start from scratch. We provide models and frameworks – you just have to adjust them to your needs. This is attractive for you - the participating executive – because it: • rapidly leads to new Business Model insight and results • is easy to work with • stimulates innovation • has the potential to expand your mindset of how business and IT strategy tasks can be performed Express Value Creation is designed to address key decision makers like CEO’s, CFO’s, COO’s, CIO’s, CMO’s and CHRO’s. For each role the angle varies and so does the view upon the challenges the company faces. However, there is a strong need by all C-level executives to better understand what IT investments to prioritize in order to realize the most value to their business. A major trend is to shift funding from non-strategic competencies to strategic competencies in order to drive value realization and growth. Contributor: Ann Rosenberg As a Global Business Process Management Lead at SAP, Ann Rosenberg is responsible for the Busi- ness Process Management, Business Architecture, Enterprise Architecture, SAP implementation and Value Management methodology/governance frameworks which are offered and used in the SAP community globally. She has designed the SAP BPX certification program for associates and professionals which is being taught globally to the SAP Community, and she is the head and founder of the SAP Global University Alliance BPM and Enterprise Architecture curriculum which are being rolled out to 900 universities globally. Ann Rosenberg is Vice Chairman of the Open Group Business Architect Group and external lecturer in Business Process Management at the IT University of Copenhagen, and lecturing assistant at Copenhagen Business School. Ann Rosenberg has published the book “Business Process Management – The SAP Roadmap” and will in July 2010 publish the book “Real World BPM in an SAP Environment”. Author: Henrik von Scheel With more than 15 years experience in leading the transformation of the businesses, strategies, processes and technologies of numerous Fortune 500 companies and recognised for his proven track record of profitable growth and ability to adopt to constant changing environment by devel- oping, implementing strategies and organizational changes needed to penetrate mature and emerg- ing markets. Henrik is co-author of SAP Press New Business Performance Management book: Applying real- world BPM in an SAP environment as well as the book: Strategies of the future. He is a guest lecturer at the Copenhagen Business School on Performance and Value Management. Henrik is currently the Vice President of IBM Software Group for NorthEast Europe and serves as Board of Director at Qosmos SA, Collax GmbH, SIRIUS advisor and WebiCoNet Holding GmbH. Contact information: E-mail: [email protected] or Phone: +45 28 80 92 81 Business Value Responsive Organization Robust Technology Focused Strategy Flexible Process Business Governance IT Governance Business Architecture Business Performance Value Realization Value Creation Value Planning Create Governance Model Create Transformation Roadmap Create Performance Metrics Identify & Prioritize Value Drivers Identify Business Issues / Pain Points Understand ‘To-Be’ Competencies Analyze ‘As-Is’ Competencies Create Operational Business Model Create Strategic Business Model Identify Value Opportunities Assess: 1. Core Competitive 2. Core Differentiated 3. Non Core Understand Business Model Analyze Strategy Business Model Performance GET Business Model Value DO Business Model SEE 13 12 11 10 9 8 7 6 5 4 3 2 1 Product Maintenance Content Product Deployment Intellectual Property Production Setup Research Product Design R&D Planning Packaging Refining Product Assembly Inbound Inventory Product Manufacture Operations Procurement Component Manufacture Operations Planning Costing Finished Goods Inventory Distribution Import & Export Transportation Order Fulfillment Scheduling Distribution Planning Servicing Customer Acquisition Customer Account Brand Management Channels Market Analysis Selling Segmentation Planning Travel Management Accounting Facility Management Finance Project Management Information Analysis Legal & Regulatory Affairs Strategic Planning Payroll Education Compensation Performance Evaluation Benefits Administration Recruitment Organizational Planning Support & Relationship Development Service Delivery Information Management Risk and Compliance IT Business Management Deployment IT Planning Data Management Equipment & Plant Safety & Security Sourcing & Procurement Environment & Health Quality Assets Operations Support Planning Operations Support Information Technology Human Resource Management General Administration Business Administration Marketing, Sales and Service Distribution Operations Business Development Business Operations SUPPORT ACTIVITIES PRIMARY ACTIVITIES New Processes Business Value Business Governance IT Governance Business Architecture Business Performance Focused Strategy Organisation Responsive Technology Robust Process Flexible