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The Value Creation Model

The value creation paradigm, VCP complements the profit and loss paradigm, PLP.

Rather than focus on the production functions and their effects on the financials, the

VCP focuses on the personnel, who operate these functions to create the financials.

This paradigm recognises the following three, 3 value types:

People Value, C

Organisational Value, ROI

The Value of the Business Environment, EB

The people value, C and the organisational value, ROI are linked by the following

relationship:

This is inclusive of the value of the business environment, EB. Given the

factor-C therefore, the factor-EB is automatically determined. Formally:

ROI = 2X – 1,

1

X =

1 – 1/C,

RES = RGT,

Po→1

Rgt = (%Nd/100)/S

Res = (1 – S)/(%Wk/100)

%Wk = 100(CWk/C’)

%Nd = 100(CNd/C’)

C’ = CWk + CNd

CNd = LogC/Log(1/S)

CWk = 1 – 1/3 S

RES = Index of the Response to Phenomena

RGT = Index of the Appropriateness of Response

Nd = Need Index

Wk = Index of Work

S = Index of Soul

C’ Index of Consciousness

C = Character Index

C = Character of Consistency

ROI = Return on Investment

The index of work, Wk measures the capacity to reconstruct the standard procedure

for the performance at task. The need index, Nd measures the obstacles in the path

of the reconstruction. These obstacles are environmental, deriving from entropy

contributions. In general, there are two, 2 sources of entropy as follows:

The second, 2nd

law of thermodynamics, which is natural: ±1

The paradox of society, which is cultural: F

Recall that by the second, 2nd

law of thermodynamics, nature is depreciating; from

greater order, to greater disorder. And the paradox of society is summarised in the

dictum below:

Society is the product of the activities of humans in nature

But in time, society became a monster that makes humans

According to the values, norms, mores, and traditions

When the culture of any society, as represented by the values, norms, mores, and

traditions for instance; deviates from the natural order, N-O then entropy is

contributed, according to the extent of the deviation. This entropy contribution is

therefore cultural, but adds, to increase the natural entropy. This makes the

environment more toxic, and therefore verminous.

The factor-C is optimised, according to the personality model of society, PMS

presented below:

Rn = F√n,

(1.00 ≤ F ≤ 2.00)

Rn = Rationality Index

√n = The Index of the Standard Procedure

F = Personality Index of Entropy contribution

The optimisation is achieved from both ends of the model. Character, C begins to

form at home, where the basis for rationality, Rn is established. It is accomplished at

work, where reward is based on the standard procedure for the performance at task,

√n. Recall the following dictum:

As the bit to the horse,

So is the pocket to the person

It is evaluated on the following differentials of the PMS, derived according to

the relationships established on the character model:

The factors Rn, √n, and Pc are measured on their various kits as follows:

The Rn-Kit

The √n-Kit

The Pc-Kit

When only the factor-Pc is given, the factor-√n is evaluated from the

following transforms:

The factor-C also has to be transformed on the following models:

Rn = 2√n – C2,

C1 = (3Pc + 1) / 4

Then: C = √ (C1 x C2)

√n’’ = 1 / C Pc2,

√n’ = (3√n’’ + 1) / 3

Then: Rn’ = 2√n’ – C2

C2’ = (3Pc + 2) / 5

C2 = (5 C2’ + 1) / 4