How do you use value-based management to analyze your finances?

3 Set your targets and priorities

The third step is to set your targets and priorities for each value driver. You can use a combination of internal and external data, such as historical trends, forecasts, best practices, and stakeholder expectations, to determine what level of performance you want to achieve and how much you can improve. You can also use a value gap analysis to identify the areas where you have the most room for improvement and the highest potential for value creation.

4 Develop your action plans

The fourth step is to develop your action plans to achieve your targets and priorities. You can use a balanced scorecard or a similar framework to translate your strategic goals into specific initiatives, activities, and milestones. You can also assign roles and responsibilities, allocate resources, and define success criteria and indicators for each action plan. You should also consider the trade-offs and synergies among different value drivers and how they affect your overall value creation.

5 Implement and monitor your action plans

The fifth step is to implement and monitor your action plans. You can use a project management system or a similar tool to track the progress and outcomes of your action plans and to identify and resolve any issues or risks that may arise. You can also use a dashboard or a similar tool to communicate your results and feedback to your stakeholders and to ensure alignment and accountability across your organization.

6 Review and adjust your action plans

The sixth and final step is to review and adjust your action plans. You can use a periodic review process or a similar mechanism to evaluate the effectiveness and efficiency of your action plans and to measure their impact on your value drivers and your overall value creation. You can also use a feedback loop or a similar mechanism to learn from your successes and failures and to make any necessary changes or improvements to your action plans.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?