In today’s time, organizations tend to launch projects and strategies without having a clear idea of its success ratio & business metrics. Moreover, time and resources are invested in activities which give basic additions or at times nothing at all! Due to these factors, companies find it hard to access their current systems as they don’t think from a value realization perspective. Although, no matter what the case is, following the three steps below will enhance business value for your company.
Evaluate, engage, measure
Let us illustrate this process by taking a large technology company (LTC) as our prospect. This is not a tiring description, nor will it cover all the complications involved.
1) Evaluate the potential value
Firstly, we need to start working with the key businessmen who have a clear idea about the LTC’s vision and goals that coordinate with its programs and actions.
- A 2017 report states that only 40% of employees of a large MNC feel strongly connected to the company’s mission.
- Next, we take a step further and implement ‘value realization’ which has a huge impact on the business.
- Now we simultaneously recognize metrics and signals that will help us evaluate the value of each initiative. We classify metrics (cost reduction) and indicate past and future outcomes.
- Now we develop a guideline for short-listed metrics and evaluate its promising value in the next few years. There will be situations, where it will become difficult to identify the actual metrics. You’ll still have to describe success metrics for these actions and make crucial decisions along the course.
- Quality ‘value drivers’ would be a good addition if they meet up with your company’s key goals.
2) Engage through ‘Initiatives’
‘Potential values’ can help you identify the rank of an initiative. Every organization has their unique way of handling investments. In our case of LTC, we used NPV (net present value).
- More than 50% of employees time is spent on work that does not link up with the company’s business strategy.
- LTC’s new updated roadmap focuses on rich-quality projects that symbolize 80% of the expected financial worth- Pareto’s Principle in action.
- This influenced LTC to focus on projects worth of immense impact.
3) Measure by ‘performance’
‘Potential values’ can help you identify the rank of an initiative. Every organization has their unique way of handling investments. In our case of LTC, we used NPV (net present value).
- Measuring and tracking down performances are the key factors for the process of ‘value realization.’
- With the help of LTC, we were able to recognize reporting frequencies and developing dashboards & data to track performances via selected metrics and signals.
- As initiatives take time to give results, we focused on the top indicators to make sure we were on the right track.
- Last but not the least, ‘tracking of performance’ will help you reshape your efforts, as projects usually tend to divert from your initial plan. This would present you with the chance to search for alternative sources that you might have missed out on before or those that were unavailable earlier.
One last point: A lot of complicated things have been excluded from this process, and it has been explained in the simplest of ways possible. For instance, data doesn’t usually exist, but to grab hold of it; one needs to design ideas for it. When no baseline exists, people depend on assumptions to evaluate ‘value realization.’ Hence you should have a profound understanding of business strategies and commitment towards your company for achieving high-quality business value.
Conclusion:
If you focus on your business values, it will help you accomplish your organizational goals with the available resources. Using the above ‘essential’ three steps to boost your business value – evaluate, engage, and measure – will eventually turn out to be the primary factors of your organizational success.
