Creating and Capturing Value: More than Just Cost Reduction
More than ever, executives and managers are under pressure to reduce cost and increase efficiency and effectiveness. Today, there is significant commercial incentive to achieve greater and sustained value from planned investments and operations.
However, good value—whether inherent, added or new—does not automatically occur from the successful delivery of a planned initiative (or even series of initiatives). It is influenced by decisions made before an initiative starts, during the initiative delivery period and also after the initiative is delivered.
Research from the Project Management Institute and the Economist Intelligence Unit suggests that there is huge waste in strategy setting and in strategy implementation. There are a myriad of reasons why, but many are associated with poor dialogue and decision making around value creation and capture.
Decisions that have the greatest influence on value generally occur at the early stages of any initiative, although elements of value management can be applied during the complete life cycle of an investment. These decisions, together with the related conversations, need to be well informed, objective and—if necessary—challenged. Those are done together by using a value management framework.
What is Value and What is Value Management?
The word “value” is one that most people can relate
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