How to develop a Value Creation PlanAccording to the Balanced Scorecard Institute, one of the pitfalls that could hold you back from being fully successful in your strategic planning efforts is developing an “executable” business strategy.
In the 9 Steps to Perfect Strategy Execution and Control, once the Board and Senior Executive team are aligned; they’ve all bought-in and agreed to a clearly defined business strategy, you need take the second step and translate the business strategy into something tangible and real, that is visible and accessible to the Business and, most importantly, creates and adds value.
Value creation is the primary aim of any business. We believe that organisations not only need a business strategy, but that the strategy needs to be a part of a wider Value Creation Plan – something that exists to create value for organisations and its employees. Without a value-driven business strategy that increases ROI, a Business cannot grow.
The Value Creation Plan
- Translates the CEO’s operational objectives into clear, understandable value-drivers;
- Bridges the strategy and execution gap; connects the CEO’s vision and objectives with the rest of the organisation; and
- Shapes a winnning culture.
The value-drivers need to be measurable; ones which start with words like increase, decrease, reduce etc, and SMART (specific, measurable, achievable, realistic, timely).
The next key building block is creating objectives and initiatives to support the value-drivers flowing from the value-creation plan. Set realistic targets that need to be met to achieve the objectives and then identify the actions needed to succeed.
The next piece of the puzzle is to link the value-drivers, objectives and actions together in a clear, easy to use format. This is your overall action plan; the objectives and actions with target dates and owners, that can be shared across the organisation with individuals, teams, business units etc.
To execute a Value Creation Plan successfully you need everyone in your organisation to know what it is, what they need to do, when they need to do it by and to have the tools to do the things needed for it to be successful.
If you want a Value Creation Plan that you can measure, empowers your organisation and creates the value you have identified that you need, then it is important to build it the right way!
10 steps to building a successful value-creation plan
- Create measurable and SMART value-drivers
- Develop objectives and initiatives to support your value-drivers
- Set realistic targets
- Identify actions needed to achieve the targets
- Link your objectives and actions to the value-drivers
- Add target dates
- Share your value-creation plan
- Track and measure performance of the value-creation plan
- Share the progress and performance reports
- Incorporate feedback into your value-creation plan to keep it current
Is your organisation's value-creation & strategy planning process as efficient as it could be? The reality is that according to Harvard Business Review “Companies realize only 40-to-60 percent of their business strategies’ potential value”
Here at EXM we believe that execution excellence is the basis of value-creation for organisations and individuals. Are you ready to translate your Company's strategy into an executable ‘Value-Creation Plan'? Why not download our brochure today to learn more.