When one is explaining value modeling to a CFO, you want to focus on the main things: the value proposition of the organization, how you calculated the metrics, what metrics did you use, etc. So how do you keep the value propositions into easily understood dimensions that are generally applicable to companies across industries.

I have been thinking hard and fast about this for a while. How can I effectively categorize any value proposition into well-defined buckets? Mind you, this categorization exercise that I went through only applies to for-profit entities. It most certainly will be different for governmental and non-profit organizations. They would have other considerations such as community health, citizen well-being, etc. that are usually not directly relevant for a business entity.

After some careful consideration, I hypothesize the following:

For a for-profit enterprise, all value for things can be related into one of the following eight dimensions: Fiscal, Customer, Operations & Process, Information/Operational Technology, People, Sales, Marketing, Risk Avoidance.

Typical Value Lever Dimensions

Let me provide examples of these dimensions to illustrate them further:

  1. Fiscal: Business outcomes related to uptick in revenue, profit margin improvement, COGS reduction, etc.
  2. Customer: Customer related objectives such as lifetime customer value, customer stickiness, renewal, etc.
  3. Operations & Process: Goals related to modernization, reduced downtime, improved capacity, streamlined operations, etc.
  4. Information/Operational Technology: Goals related to reduction of maintenance costs, improved security, faster time to market, upgrading of systems, future proof the business, single version of truth, etc.
  5. People: Human capital initiatives related to employee productivity, talent management, etc.
  6. Sales: Goals related to increased sales opportunities, improved win rates, shortened sales cycles, faster time to value, etc.
  7. Marketing: Related to objectives such as improved branding, reach, effective campaign management, etc.
  8. Risk Avoidance: Goals related to the reduction in cost of compliance, information protection, security, etc.