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Deloitte Sustainability Value Methodology
Copenhagen, 28 June 2006 Preben Soerensen Sam Vaseghi
Seite 2 © 9/27/2005 Deloitte & Touche
Leading companies understand that there is not always a trade-off between Shareholder & Stakeholder value
Create Sustainable
Value
Create pure Economic Value At the expense of environmental and
social value
Destroy Value
Stakeholder Value:
Social & Environmental
Value
Positive
Negative
Shareholder Value: Economic Value Positive Negative
Source: Adapted from Sustainable Value Partners
Create pure Environmental &
Social Value
At the expense of economic value
Our approach aims at maximizing the benefits of converging value drivers in order to create sustainable value for both shareholders and stakeholders.
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Strategic
Planning for
Sustainable
Development
Our Sustainability service offerings span across all Stakeholder and Shareholder Value Drivers
S T
A K
E H
O L
D E
R
V
A L
U E
S H A R E H O L D E R V A L U E
Revenue Growth
Asset Efficiency
Expectations
Reporting & Performance Measurement
Operating Margin
Enterprise Operational
Excellence
Environment, Health and
Safety
Human Capital Management &
Employee Productivity
Disability & Work
Attendance Management
Corporate Governance & Transparency
Mate
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l S
ou
rcin
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Prod
ucti
on
Eff
icie
ncy
Op
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on
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Im
pact
P
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&
Servic
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Our Sustainability service offerings span across all Stakeholder and Shareholder Value Drivers
S T
A K
E H
O L
D E
R
V
A L
U E
S H A R E H O L D E R V A L U E
Revenue Growth
Asset Efficiency
Expectations
Operating Margin
Mate
ria
l S
ou
rcin
g
Prod
ucti
on
Eff
icie
ncy
Op
erati
on
al
Im
pact
P
rod
ucts
&
Servic
es
1. Map Stakeholders’ Values 4. Map Shareholder Value
2. Define Sustainability Issues 3. Design Business Case
Seite 5 © 9/27/2005 Deloitte & Touche
The Sustainability Value Methodology
1. Map Stakeholders’ Values 4. Map Shareholder Value
•Identify/reassess and characterize stakeholders • Proactively identify/reassess stakeholder expectations •…
2. Define Sustainability Issues
• Define/Refine key issues from stakeholder perspective • Translate definition of issues into shareholder perspective •…
3. Design Business Case
• Track via ValueMap • Assess Risks and Opportunities • Design appropriate business cases by ValueMap •…
• Apply ValueMap to map value from business cases • Apply ValuePrint to evaluate/assess business cases •…
Seite 6 © 9/27/2005 Deloitte & Touche
First Step Map Stakeholders’ Values and Define Sustainabilty Issues
S T
A K
E H
O L
D E
R
V
A L
U E
S H A R E H O L D E R V A L U E
Revenue Growth
Asset Efficiency
Expectations
Operating Margin
Mate
ria
l S
ou
rcin
g
Prod
ucti
on
Eff
icie
ncy
Op
erati
on
al
Im
pact
P
rod
ucts
&
Servic
es
1. Map Stakeholders’ Values 4. Map Shareholder Value
2. Define Sustainability Issues 3. Design Business Case
Seite 7 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Seite 8 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Environmental Issues
New markets for environment-friendly and energy-efficient products in emerging economies
Social Issues
New markets for emerging consumer needs in emerging economies
Workplace health and safety*
Labour standards*
Human rights issues*
Corporate governance issues
Complying with local laws, while upholding global corporate governance and responsibility standards
Seite 9 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Environmental Issues
Carbon constraints (climate change)
Environmental liabilities
Pollution prevention
Reducing emissions and resource use
New markets for environment-friendly and energy-efficient products
Seite 10 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Environmental Issues
Product stewardship
Waste and toxic release management
Accident and spills management
Efforts to incorporate external costs in planning and accounting
Seite 11 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Social Issues
HR management (including compensation, training, etc.)
Attracting and retaining employees
Workforce diversity and equal opportunities
Seite 12 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Environmental Issues
Environmental governance and management systems
Accidents and spills management
Social Issues
Community and NGO relations
Government relations
Investor relations
Management of crisis situations*
Corporate governance issues
Board structure and accountability
Accounting and disclosure practices
Audit committee structure and independence of auditors
Executive compensation
Management of corruption and bribery instances
Business ethics policies
Corporate citizenship engagement
Seite 13 © 9/27/2005 Deloitte & Touche
Deloitte Generic Catalogue of Sustainability Issues
Global trend:
1. Changing demographics and the emergence of new consumer and labour markets.
2. Boosting innovation for efficiency and reduced impact on environmental and climate systems.
3. Preserving the natural resource base.
4. Doing business in a globalized, interconnected economy.
5. Earning the license to operate.
6. Changing geopolitical risk landscapes.
Social Issues
Human rights, community and government relations in politically unstable countries/conflict zones
Corporate governance issues
Policies and systems to manage risk in politically unstable countries/conflict zones
Seite 14 © 9/27/2005 Deloitte & Touche
Aligned with the Strategic Planning for Sustainable Development
Example: Identifying together with you your relevant and material Sustainability Issues aligned with your corporate strategy
Environmental Issues
Environmental and safety management of production processes
Declining capacity of eco-systems to sustain intensive harvesting and production methods
Business in a carbon-constrained world
Social Issues
Changing consumer preferences, new needs in emerging markets
Management of global workforce
Labour practices and HR management
Community relations, corporate citizenship engagement
Corporate Governance Issues
Corporate governance framework
Transparency in relation to sourcing and production methods
Government relations, business ethics
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Second Step Design Business Case and map shareholder Value
S T
A K
E H
O L
D E
R
V
A L
U E
S H A R E H O L D E R V A L U E
Revenue Growth
Asset Efficiency
Expectations
Operating Margin
Mate
ria
l S
ou
rcin
g
Prod
ucti
on
Eff
icie
ncy
Op
erati
on
al
Im
pact
P
rod
ucts
&
Servic
es
1. Map Stakeholders’ Values 4. Map Shareholder Value
2. Define Sustainability Issues 3. Design Business Case
€
Seite 16 © 9/27/2005 Deloitte & Touche
4. Map Shareholder Value 3. Design Business Case
Proposed value framework for integration of key stakeholder issues
Issue
Issue
Issue
Issue
Issue
Issue
Strategy Policies
Management- Systems
Litigation and regulatory risks
Operational risks
Reputation and brands
Operational efficiency
Innovation
Access to new / Existing markets
Access to knowledge and skills
Access to ressources
Others
Risk premiums
Costs
Revenues
Other (tax, reinvestment
rates)
WACC
Free cash flows
Shareholder value
Stakeholder value
Seite 17 © 9/27/2005 Deloitte & Touche
Optimize depreciationmethods/lives forproperty, plant andequipment
Optimize valuationand costing methodsfor inventories(LIFO, FIFO, uniformcapitalization, shrinkage,obsolescence, etc.)
Ensure full utilizationof tax carryforwards(credits, net operatinglosses, capital losses, etc.)
Consider tax implica-tions in the location/selection of facilities(distribution centers, servicecenters, branches, etc.)
Improve salesforecasting andcampaign executionprocesses and tools
Improverelationship/accountdevelopmentprocesses
Improve skills ofsales staff
Provide staff withbetter customerinformation(demographics, inquiryhistory, etc.)
Improve staffincentives aroundsales efficiency
Improve processesfor generating,qualifying andassigning leads
Improvefield sales andtelesalesprocesses
Consolidate/realignsales territories
Improve terms withsales channels
Improve terms withservice providers(network services, airlines,information services, etc.)
Improve terms onleased sales assets(computers, vehicles, etc.)
Target newgeographies
Target new segmentswithin currentgeographies
Expand sales andadvertising channels
Acquire new productand service offerings
Pursue joint-venture,partnership and OEMarrangements
Increase focus onhigh-value/high-potential customers
Increase focus onmost profitableproducts and services
Increase focus onmost effective salesand advertisingchannels
Improve brandstrength and good will
Increase time spentselling
Improve quality andassignment of salesleads
Improve access toinformation andanalytical tools
Improve sales andmarketing skills ofstaff
Improve alignment ofstaff incentives withstrategic objectives
Improve effectivenessof marketing,advertising and salesprocesses
Tailor marketing andsales approaches tocustomer segments
Tailor products andservices to newcustomer segments
Evolve product andservice features,functionality and value
Improve totalcustomer experience(purchasing, fulfillment,usage, support, service,etc.)
Increase focus onhigh-value/high-potential customers
Improveresponsiveness tocustomer complaints/feedback
Improveunderstanding ofcustomer needs
Proactively managetransition points(life events, ends ofcontracts and leases, etc.)
Tailor accountmanagementapproaches tocustomer segments
Maintain competitivefunctionality and value
Tailor cross-sell/up-sell offers to customerneeds
Implement pricing andaffinity programsbased on volume andbreadth
Offer value-addingproduct and servicebundles
Improve effectivenessof cross-sell/up-sellprocesses
Implement proactiveand reactive cross-sell and up-sellcampaigns
Improve staffincentives for cross-selling/up-selling
Improve identificationof cross-sell/up-sellopportunities
Increase focus onhigh-value/high-potential customers
Increase focus onmost profitableproducts and services
Increase focus onmost effective salesand advertisingchannels
Improve retention andwin-back processes
Build customersatisfaction andretention into staffincentives
Improveunderstanding ofchurn/defectiondrivers
Improve identificationof churn/defectioncandidates
Increase focus onhigh-value /high-potential customers
Improvecompetitiveness ofproduct and serviceofferings
Shorten time-to-market
Improve brandawareness / Elevatebrand image
Increase emphasison supply chainmanagement(production, distribution andsales pipelines)
Obtain exclusiveagreements withpartners(licenses, distributorships,etc.)
Improve features andfunctionality ofproducts and services
Improve quality andreliability of productsand services
Improve product andservice lifecyclemanagement
Improvecommunication andcoordination withdistribution centers
Improvecommunication andcoordination withsales channels
Improve focus onhigher-valuesegments
Rationalize and/orrefocus channel/media usage
Rationalize and/orrefocus product andservice portfolios
Rationalize targetedcustomer segments
Improve campaigndesign andmanagementprocesses and tools
Improve skills ofmarketing staff
Improve staffincentives aroundmarketing efficiency
Provide staff withbetter market andcustomer information
Improve definition ofproduct and servicespecification
Improve product andservice launchprocesses
Provide staff withbetter competitiveinformation
Improve tailoring ofmarketing andadvertisingapproaches tocustomer segments
Improve terms withadvertising channels
Improve terms withservice providers(researchers, informationservices, advertisingchannels, etc.)
Improve emphasis onproduct quality andease of service
Design products forease-of-use / self-service
Route low-valuetransactions to lower-cost sales channels
Improve routing ofservice requests toappropriate staff
Increase use of lower-cost service andinformation channels(contact centers, automatedvoice response, web, etc.)
Improve workforceplanning and dispatchprocesses and tools
Improve capacity/demand planningprocesses, skills andtools
Improve service andsupport processes
Improve skills ofservice staff
Provide staff withbetter customerinformation(profiles, transactionhistories, etc.)
Improve incentivesaround serviceefficiency andeffectiveness
Improve terms withservice providers(network services,outsourced functions, etc.)
Improve terms onleased service assets(computers, vehicles, etc.)
Improve forecasting,planning andprioritization skills andtools
Improve creditanalysisprocesses
Improve skills of ordermanagement andbilling staff
Provide staff withbetter customer andorder information
Improve incentivesaround ordermanagementefficiency
Improve pick, packand ship processes
Improveprovisioning/installation processes
Improve invoicing/billing processes
Improve policies andprocesses aroundmerchandise returns
Improve terms withservice providers(delivery services,outsourced functions, etc.)
Improve terms onleased assets(computers, vehicles, etc.)
Consolidate and/orre-architect datastores
Increase utilization ofIT, telecom andnetwork resources(servers, routers, networkcapacity, etc.)
Improve design,development andtesting processes
Improve processes formanaging systemoperations, mainten-ance and changes
Improve end-usersupport andadministrationprocesses
Improve selection,acquisition andcontractingprocesses
Improve installation/deploymentprocesses
Improve technical andproject managementskills of staff
Improve dispatch,diagnostic, resolutionand replacementprocesses
Improve incentivesaround IT/networkefficiency
Improve terms withservice providers(contractors, networkservices, consultants, etc.)
Improve terms onpurchased and leasedassets (PCs, servers,network equipment, leasedlines, etc.)
Improve terms onpurchased and leasedreal estate, furnitureand fixtures
Increase utilization ofreal estate
Improve capacity/demand planningprocesses and tools
Improve real estatedesign and develop-ment processes
Improve operationalprocesses(administration, security,energy, HVAC andmaintenance)
Improve real estateselection, acquisitionand contractingprocesses
Improve real estateimprovement anddeploymentprocesses
Improve terms withservice providers(security, energy, etc.)
Improve terms onimprovements(HVAC, cabling, etc.)
Improve terms withthird-party productand service providers(payroll, benefits, training,etc)
Reduce salary andbenefits costs /Improve value ofemployee benefits
Improve capacity/demand planningprocesses and tools
Implement/improvecompany-wideprocesses and toolsfor assessing staffperformance
Improverecruitment andorientation processes
Improve skills of HRstaff
Provide staff withbetter HR informationand tools
Improvetrainingprocesses
Improve salary andbenefits administra-tion processes /Increase employeeself-service
Improvepayrollprocesses
Improveperformanceassessmentprocesses
Rationalize/consolidate vendorportfolio
Increase focus onhigher-value vendorpartnerships
Improve collaborationwith vendors
Increase use of lower-cost channels(self-service, etc.)
Improve assignmentof procurementtransactions toappropriate staff
Improve demandplanning processesand tools
Improve productprocurementprocesses(equipment, supplies, etc.)
Improve serviceprocurementprocesses(travel, contract labor, etc.)
Improve contractingand negotiation skillsof procurement staff
Provide staff withbetter product andservice information
Improve incentivesaround procurementefficiency
Improve terms onequipment andsupplies
Improve terms withservice providers(equipment maintenance,delivery, warehousing, etc.)
Improve terms withservice providers(information services,consultants, etc.)
Improvestrategic planningprocesses
Improve skills ofbusinessmanagement staff
Provide staff withbetter managerialinformation and tools
Improve incentivesaround businessplanning efficiency
Improveprogram planningprocesses
Improve capitalbudgetingprocesses
Improveprogrammanagementprocesses
Improveaccounting andmeasurementprocesses
Improve terms withfinancial servicesproviders
Improvecash/treasurymanagementpractices
Improve skills offinancial managementstaff
Improve incentivesaround financialmanagementefficiency
Improve debt andequity managementprocesses
Increase focus onmaterials-efficientproductionmechanisms
Rationalize and/orrefocus productportfolio
Increase emphasis ondesigning formaterials efficiency
Rationalize/consolidate vendorportfolio
Focus efforts onhigher-value vendorrelationships
Improve terms onmaterials purchases
Rationalize orderquantities and timing
Improve materialsperformancemanagementmethods and tools
Improve demandforecastingprocesses, skills andtools
Improve ordering andreceipt processes(raw materials, intermediatematerials, finishedcomponents, etc.)
Improve materialsefficiency ofproduction processes
Improve contractingand negotiation skillsof purchasing staff
Provide staff withbetter productinformation and tools
Design products touse cost-effectivematerials
Improve terms withservice providers(delivery, warehousing, etc.)
Rationalize and/orrefocus productportfolio
Improve focus onhigher-value products
Rationalize productionquantities and timing
Increase use of lower-cost productionchannels
Improve terms withservice providers(outsourced functions, etc.)
Improve termson equipmentpurchases
Improve productionperformancemanagementmethods and tools
Improve demandforecastingprocesses, skills andtools
Improve capacityplanning processes,skills and tools
Improveproduction schedulingand stagingprocesses
Improve utilization ofproduction channels /Reduce downtime
Improve skills ofproduction staff
Provide staff withbetter productioninformation and tools
Improve incentivesaround productionefficiency
Improve coordinationwith businesspartners
Improvemanufacturing andquality controlprocesses
Rationalize and/orrefocus productportfolio
Rationalize/consolidate vendorportfolio
Improve focus onhigher-value vendorrelationships
Improve terms onmerchandisepurchases
Rationalize orderquantities and timing
Improvemerchandisingperformancemanagementmethods and tools
Improve demandforecastingprocesses, skills andtools
Improve assignmentof transactions toappropriate staff
Improvemerchandiseordering and receiptprocesses
Improve skills ofmerchandising staff
Provide staff withbetter information andtools
Improve incentivesaround merchandisingefficiency
Improve coordinationwith vendors
Improve terms withservice providers(delivery, warehousing, etc.)
Rationalize and/orrefocus productportfolio
Increase emphasis ondesigning andpackagingfor distribution
Increase quality andconsistency ofmaterials
Rationalize productionquantities and timing
Rationalizemerchandise orderquantities and timing
Increase use of lower-cost logistics anddistribution channels
Improve inventoryreceipt and storageprocesses
Improve transport anddelivery processes/algorithms
Improve skills ofinventory anddistribution staff
Provide staff withbetter information andtools
Improve incentivesaround inventory/distribution efficiency
Improve logisticsperformancemanagementmethods and tools
Improve demandforecastingprocesses, skills andtools
Improve terms withservice providers(transport, warehousing,etc.)
Improve focus onhigher-value customersegments andproducts
Rationalize and/orrealign productdevelopmentefforts
Increase use of lower-cost productdevelopmentchannels
Improve productconception/initiationprocesses
Improve utilization ofproduct developmentchannels
Improve skills ofproduct developmentstaff
Improve definition ofproduct and servicespecifications
Improve incentivesaround productdevelopmentefficiency
Improveprototyping, pilotingand testing processes
Improvedesign anddevelopmentprocesses
Improve identificationand discontinuation ofunsuccessfulefforts
License or acquireproducts andintellectual property
Develop businessmodels with low realestate requirements
Reduce number ofdata centers, branchoffices, dealerships,retail outlets, etc.
Outsource businessfunctions
Increase use ofleased real estate
Improve termson property andfacilities
Reconfigure facilities /Increase utilization offacilities
Increase use offlexible facilities
Divest low-utilizationreal estate
Rationalize and/orrefocus product andservice portfolios
Outsource businessfunctions
Increaseuse of leasedproduction equipment
Improve terms on ITsystems
Increase use offlexible/expandableproduction equipment
Increase emphasis ondesign formanufacturability andservice
Divest low-utilizationequipment
Improveeffectiveness of plantmaintenance
Improve termson infrastructure
Divest low-utilizationinfrastructure
Increaseuse of flexible andexpandableinfrastructure
Increase use ofleased infrastructure
Rationalize and/orrefocus productportfolio
Rationalize and/orrefocus customersegments anddistribution channels
Develop low-Inventorybusiness models
Increase emphasison build-to-order
Improve terms onmerchandise
Improvecollaboration withvendors/partners
Improvedemand forecasting
Consolidateinventory
Improve logistics/distribution efficiency
Divest low-demand/obsolete inventory
Rationalize and/orrefocus productportfolio
Shorten productioncycles
Rationalize rawmaterials
Increase use of just-in-time procurement
Improvedemand forecasting
Improve terms onmaterials
Divest obsoletematerials
Coordinatemanagement ofcredit/receivablesacross business units
Increase focus oncustomer segmentswith low credit/loanneeds
Tighten credit/loanterms
Improve assessmentand benchmarking ofcredit/receivablesperformance
Improve managementof delinquentaccounts
Coordinatemanagement ofpayables acrossbusiness units
Leverage credit ratingto lengthen paymentcycles and reduceinterest rates
Leverage breadth ofvendor relationshipsto lengthen paymentcycles
Improve managementof debt portfolio
Improve identificationand prediction ofindustry and markettrends
Improve identificationof opportunities andthreats
Improve strategydevelopment capa-bilities at corporateand business-unitlevels
Improve alignment ofbudgets and capitalprograms withstrategic priorities
Improve executivedevelopment,recruiting andsuccession planning
Improve identification,assessment andexecution ofM&A/divestitureopportunities
Improvecommunication ofstrategic directionsand priorities
Improve structuringand launch ofcohesive programportfolios
Improve coordinationand communicationacross programs andprojects
Improve program/project managementmethods and tools
Improve alignment ofprojects with programand businessobjectives
Improvemeasurement andreporting ofoperational andfinancial performance
Improve analysis ofmanagerialinformation
Improve focus onmost importantmanagerialinformation
Improvecommunicationaround improvementpriorities
Improve abilityto launchimprovement efforts
Improve quality andconsistency ofperformanceassessment methods
Improve careeroptions and paths
Align managementand staff incentiveswith companyperformance
Improve monetaryand non-monetaryrecognition of staffcontributions
Improve breadth,depth, quality andtimeliness of perform-ance information
Improve effectivenessof organizationalstructures andgovernance models
Increase emphasis onquality managementand benchmarking
Improveprocess innovationskills of staff
Improve depthand breadth of stafftechnical skills
Improve qualityand speed ofcommunication withpartners
Improve ability tointegrate mergedand acquiredorganizations
Improve ability toidentify and assesspartneringopportunities
Improvemanagement ofpartner relationships
Improve integration ofbusiness processesacross partnernetworks
Improve valuedelivered tocustomers
Improve valuedelivered to partners(vendors, channel partners,etc.)
Improve valuedelivered toemployees
Improve identificationof opportunities toincrease value tostakeholders
Improve understand-ing of stakeholderinterests (customers,shareholders, regulators,employees, suppliers,partners, alumni, etc.)
Improve conversion ofstrong relationshipsinto sources of com-petitive advantage
Improvecommunication withstakeholder groups
Improve agility andflexibility oforganizationalstructures
Improve agility andflexibility ofgovernance models
Improve flexibilityof businessprocesses
Improve versatility ofmanagers and staff
Improve flexibilityand versatility of ITsystems andplatforms
Rationalizecustomer portfolio
Improveresponsiveness tocustomer requestsand inquiries
Improve tracking ofcustomer interactions(purchases, supportrequests, etc.)
Improve identificationof valuable customerrelationships
Refocus and/or refineretention priorities andstrategies
Create barriers toswitching
Solicit and respond tocustomer feedback
Implement affinityprograms
Increase emphasison differentiatedproducts and services
Improve demandforecasting
Improveunderstanding ofcustomer, productand channelprofitability
Consolidate oroutsource service andsupport operations
Differentiate servicetreatment ofcustomers/segments
Provide staff withbetter product andservice information
Improve financialrisk managementprocesses
Increase use of lower-cost delivery/installation channels(self-service, partners, etc.)
Increase use of lower-cost billing channels(automated, self-service,etc.)
Differentiate treatmentof customers/segments
Improve emphasis ondesign for packing/shipping efficiency
Consolidate oroutsource orderfulfillment functions(pick, pack and ship,install, provision, etc.)
Consolidate oroutsource billingoperations
Consolidate oroutsource design,development anddeployment services
Consolidate oroutsource operationsand maintenanceservices
Consolidate oroutsource end-usersupport
Consolidate companyreal estate/facilities
Consolidate oroutsource design anddevelopmentfunctions
Rationalize ITapplication portfolio
Consolidate oroutsourceimprovement anddeployment
Consolidate oroutsource propertymanagementfunctions
Increase use of lower-cost real estate andfacilities / Relocatebusiness operations
Consolidate oroutsource benefitsadministrationfunctions
Consolidate oroutsource payrollfunctions
Consolidate oroutsource recruitmentfunctions
Refine vendorstrategies
Standardize productcatalogs(equipment, office supplies,promotional materials, etc.)
Consolidate oroutsourceprocurement functions
Consolidate and/oralign businessplanning,management andreporting functions
Improve alignment oforganization struc-tures and governancemodels with businessstrategies
Consolidate and/oralign financialplanning,management andreporting functions
Consolidate and/oralign financialaccounting andanalysis functions
Improve incentivesaround procurementefficiency
Increase emphasis ondesign for productionefficiency
Consolidate oroutsource productionfunctions
Refine/alignlogistics anddistribution strategies
Increase focus onhigher-value productsand partners
Consolidate/outsource logisticsand distributionfunctions
Rationalize and/orrefocus product andservice portfolios
Consolidate oroutsource productdevelopmentfunctions
Increase emphasis onmodular, extensible,scalable designs
ConsolidateIT systems,production lines andservice mechanisms
Increase emphasis onhigh-turn products
Increase emphasis ondesigning formanufacturingefficiency
Improvecollaboration withvendors/partners
Increase emphasis ondesigning formaterials efficiency
Increase focus onvendors withfavorable paymentterms
Increase emphasison risk-informed,scenario-basedplanning
Increase emphasis onenterprise-wideprogram planning andcollaborative programdelivery
Increase emphasison continuous,proactive perform-ance management
Improvedetermination of keyperformance metricsand targets
Establish a culturecentered onoperationalexcellence
Increase focus onpartnership, mergerand acquisitionopportunities
Increase focus onstakeholderrelationships
Establish processimprovement andinnovation as keycompetencies
Establishmanagement of keystakeholderrelationships asorganizational priority
Increase focus onbusiness agility andflexibility
Establish agility andflexibility as keycompetencies
Increase integration ofbusiness processesacross organizationalboundaries
Improvepartnership andcollaboration skills ofstaff
Improve utilization ofsales staff
Improve utilization ofservice staff
Provide staff withbetter product, serviceand competitiveinformation
Implement integratedapplications acrossorganizationalboundaries
Consolidate IT,telecom and networkequipment andfacilities
Utilize moreefficient productionequipment
Improve quality andconsistency ofmanufacturingmaterials
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Improve value /Decrease prices
Improve assessmentand benchmarking ofbusiness processperformance
Improve sharing ofknowledge acrossorganizationalboundaries
Improve sharing ofknowledge acrossorganizationalboundaries
Improve businesscontinuity planningand disaster recoverycapabilities
Improve ability todevelop and spin-offnew businesses
Increase focus on riskmanagement andregulatory compliance
Improve focus onprice-insensitivecustomer segments
Increase emphasis ondifferentiated pricingacross customersegments
Improveunderstanding ofcustomer pricesensitivity
Align advertising withpricing strategies
Improve tailoring ofofferings to customerneeds
Increase use ofdifferential pricingmechanisms (based oncustomer value, risk, etc.)
Increase emphasison preventiveequipmentmaintenance
Defer/change timingof capital investments
Increase utilization ofproduction equipment
Increase focus onmanagerial, forward-looking information
Improveunderstanding ofproduct/service valueto customers
Increase focus onpricing effectiveness/price optimization
Increase focus onR&D, productinnovation, andproduct leadership
Broaden product andservice offerings
Improve product/service R&Dand deploymentcapabilities
Adapt currentproducts and servicesfor new segments/channels
Improve product- andservice-innovationskills of staff
Increase emphasis onservice prevention /Reduce need forservice
Increase emphasis ondesigning for serviceefficiency and self-service
Route low-valuetransactions to lower-cost sales channels
Improve routing ofservice requests toappropriate servicechannels
Increase use ofcheaper servicechannels
Improve serviceperformancemanagementmethods and tools
Improve workforceplanning, dispatchand assignmentprocessesand tools
Improve capacity/demand planningprocesses, skills andtools
Improve service andsupport processes
Improve skills ofservice staff
Provide staff withbetter customerinformation(profiles, transactionhistories, etc.)
Improve staffincentives aroundservice efficiency
Improve terms withservice providers(outsourced services,network services,information services, etc.)
Improve terms onleased service assets(computers, vehicles, etc.)
Consolidate oroutsource serviceoperations
Differentiate treatmentof customers/segments
Provide staff withbetter product, serviceand contractinformation
Rationalize and/orrefocus servicesoffered
Improve utilization ofservice staff
Improve focus onhigher-value customerrelationships
Convert free servicesto fee-based services
Align product andservice prices withvalue to customers
Establish product,service and processinnovation as keycompetencies
Improve productinnovation processes
Improve product,service and processinnovation skills ofstaff
Improve assignmentof accountability andauthority
Improve effectivenessof organizationalstructures
Dynamically cancel orredirect ineffective/obsolete programsand projects
Improve tracking andcommunication ofprogram/projectprogress
Improve assignmentof resources toprojects
Improve program/project managementskills of staff
Improve managementof vendors/serviceproviders
Establish program/project delivery as akey competency
Improve alignment ofcustomer, product,advertising, sales,service, support, andfulfillment strategies
Develop, spin-off andsell new businesses
Improve investmentreturns on cash/treasury funds
License or sellintellectual capital toother enterprises
Improve brandstrength and good will
Improve brandstrength and good will
Sell appreciatedassets
Increase emphasis ongenerating revenuefrom company assets
Increase focus ondeveloping andprotecting intellectualcapital
Increase focus oncreditworthy customersegments
Improve collectionsprocesses
Improve andstandardize creditassessmentprocesses
Differentiate credittreatment ofcustomers/segments
Improveunderstanding ofcustomer needs
Increase focus onexpansion ofcustomerrelationships
Improve product andservice withdrawaland retirementprocesses
Acquire competitors
Improveestablishment of andadherence to service-level targets
Increase use ofdistance/on-linelearning
Establish customercommunities
Improve cross-selland up-sellapproaches/models
Apply brand to newand unbrandedproducts
Develop and leveragestrong/unique partnerrelationships
Develop and leveragestrong brand
Develop strongcustomerrelationships andcommunities
Develop and utilizeunique physicalresources(facilities, land, etc.)
Develop and utilizeunique humanresources(thought leaders, managers,subject matter experts, etc.)
Develop and leverageintellectual capital(copyrights, patents,trademarks, etc.)
Increase focus onstrategic assets
Improve assetdevelopment skills ofmanagement andstaff
Improve incentivesaround assetdevelopment
Establishdevelopment ofstrategic assets as akey competency
Increase emphasis onleveraging strategicassets
Shorten productioncycles
Improve developmentand analysis ofbusiness cases
Improve security ofapplications, systemsand data
Improve costaccounting andallocation of shared/overhead costs
Improve recruitingeffectiveness
Improve relationshipmanagementstrategies for keystakeholder groups
Improve valuedelivered toshareholders
Rationalize and/orrefocus product andservice portfolios
Rationalize and/orrefocus product andservice portfolios
Improve physicalsecurity of people
Improvecommunication andknowledge transferacross organizationalboundaries
Consolidate oroutsource learningand developmentfunctions
Increase emphasison people/talentdevelopment
Improve talentmanagement modelsand programs
Improve identificationof stakeholder groupsand establishment ofpriorities
Improve valuedelivered to otherstakeholders(public, alumni, analysts,etc.)
Shorten order-to-delivery cycle time /Improve product andservice availability
Increase emphasison design forconfigurability/customization
Improve platform andportfolio strategies forproducts and services
Increase emphasis ontime-to-market andtime-to-production-volume
Increase number andquality of product andservice launches
Increase utilization ofmodular, reusabledesigns
Improve collaborationwith design,development andproduction partners
Improve reuse ofproduct and servicecomponents
Improve managementof product lifecycles(launch through retirement)
Increase emphasis onaccount/relationshipdevelopment
Improve accountmanagement skills ofstaff
Improve incentives forproduct developmentand innovation
Improve incentives foraccount/relationshipdevelopment
Improve accountmanagementstrategies
Shorten order-to-delivery cycle time /Improve product andservice availability
Improve totalcustomer experience(purchasing, fulfillment,usage, support, service,etc.)
Improve execution ofmarket- and supply-driven promotions
Improve structuringand pricing ofpromotions
Improve coordinationwith suppliers andsales channels
Improve use ofsupply- and capacity-driven promotions
Increase use ofpromotions
Rationalize and/orrefocus product andservice portfolios
Improve focus onsegments with loweraverage cost-to-serve
Improve collaborationwith partners andcustomers
Increase use ofvendor-managed/vendor-warehousedinventory
Improve due-datereliability
Manage procurementon a national/globalbasis
Utilize national/globalpurchasing power
Increase focus oncomponent reuse
Reduce procurementcycle times
Improve collaborationwith vendors
Improve design/structure ofdistribution networks
Align production andmerchandise orderingschedules withdistribution schedules
Improve retrievalprocesses
Manage purchasingon a national/globalbasis
Refine and/or alignmerchandisingstrategies(central vs. localmerchandising, etc.)
Improve use ofnational/globalpurchasing power
Increase use ofvendor-managed/vendor-warehousedinventory
Increase use ofvendor-managed/vendor-warehousedinventory
Increase use ofvendor-managed/vendor-warehousedinventory
Improve product andservice introduction/launch processes
Rationalizeproduction facilities
Rationalize productionquantities and timing
Rationalizemerchandise orderquantities and timing
Increase use ofvendor-managed/vendor-warehousedinventory
Rationalize productionquantities and timing
Increase emphasis onuse of commoncomponents
Increase utilizationof standardizedcomponents
Manage materialssourcing on anational/global basis
Increase use ofvendor-managed/vendor-warehousedinventory
Increase emphasis oncustomer retention
Proactively managetransition points(life events, ends ofcontracts and leases, etc.)
Offer value-addingproduct and servicebundles
Improve focus onemployee retention
Improve employeeretention programs
Utilize more efficientIT systems
Utilize moreflexible/expandable ITsystems
Improve maintenanceof IT systems
Increase utilization ofIT systems
Divest low-utilizationIT systems
Improve terms onproduction equipment
Improve focus ofcompany resourceson high-priorityinitiatives
Increase emphasis oncross-business-unitand cross-companycollaboration
Increase proactivepursuit ofpartnerships, mergersand acquisitions
Increase emphasis oncustomer satisfaction
Improve qualityassurance programs
Sell or lease excesscapacity to otherenterprises(production capacity, servicecapacity, etc.)
Coordinate pricing ofcomplementaryproducts and services(razors v. blades / product v.shipping charges, etc.)
Improve price/marginknowledge of staff
Build productmargins/profitabilityinto sales incentives
Rationalize portfolio offinancial servicesproviders
Improve audit andcompliancemanagementprocesses
Improve businesscase developmentand analysisprocesses
Improve breadth,depth and quality offinancial information(asset, budget, price/cost,treasury, debtor/creditor,performance, tax, risk, etc.)
Improve budgetingand forecastingcapabilities
Improve financialreporting efficiency
Improve assetmanagementprocesses(fixed and variable assets)
Improve integration ofIT systems acrosspartner networks
Increase emphasis onoperational integrationwith partners
Remove barriers toswitching
Improve contractmanagementprocesses(negotiation, execution andcompliance)
Refine vendor/supplier strategies
Consolidate oroutsourcemerchandisingfunctions
Establishcross-companycollaboration as a keycompetency
Improve performanceand reliability of ITsystems/platforms(applications, equipment,networks, etc.)
Improve breadth,depth, quality andtimeliness of businessinformation
Improve access toand distribution ofbusiness information
Develop and utilizeunique IT resources(applications, networks, etc.)
Improveunderstanding ofcurrent customersatisfaction
Improve visibility ofcustomerrelationships andinteractions across allchannels
Improve adherence tocontracts andagreements
Increase focus onhigher-value productsand services
Improve focus onhigher-valueadvertising channels/media
Focus sales efforts onhigher-marginproducts and services
Increase use of lower-cost sales channels(telesales, outlets, self-service, etc.)
Improve focus onhigher-valuecustomers/segments
Rationalize and/orrefocus product andservice portfolios
Bypass currentchannels / Selldirectly to customers
Rationalize targetedmarkets and customersegments
Improve analyticalprocesses and tools
Improve channelmanagementprocesses and tools
Outsource propertytax administrationactivities(compliance, assessment,negotiations, etc.)
Improve businessperformance reportingprocesses
Improve alignment ofHR and technologystrategies withbusiness strategies
Improve manage-ment of regulatorycompliance
Develop and leveragepolitical relationshipsand alliances
Develop and cultivategood will
Improve anticipationand understanding ofcurrent and potentialregulations/legislation
Improve effectivenessof legislative/lobbyingefforts
Acquire companies intargeted geographies
Acquire companieswith relationships intargeted customersegments
Improve methods andtools for managingsales and marketingperformance
Acquire companiesaligned with productstrategies
Improve methods andtools for managinginnovationperformance
Increase focus ondivestiture andreinvestment
Divest non-performingand non-strategicbusiness units
Align M&A strategieswith businessobjectives
Improve/standardizeM&A processes
Improveunderstanding ofinternal value andmarket value ofbusiness units
Increase considera-tion of M&A anddivestiture options
Improve accountmanagementmethods and tools
Improve salesperformancemanagementmethods and tools
Improve retentionperformancemanagementmethods and tools
Improve managerialmethods and tools
Improve methods andtools for managingdemand/supplyperformance
Improve methods andtools for managingpricing performance
Improve marketingand advertisingperformancemanagementmethods and tools
Improve salesperformancemanagementmethods and tools
Improve service andsupport performancemanagementmethods and tools
Improve ordermanagementmethods and tools
Improve procurementperformancemanagementmethods and tools
Improve real estateperformancemanagementmethods and tools
Improve HRperformancemanagementmethods and tools
Improve/consolidateIT performancemanagementmethods and tools(utilization, performance,capacity planning, etc.)
Improve productdevelopmentperformancemanagementmethods and tools
Improveunderstanding ofbusiness unitperformance andmarket values
Consolidate devicemanagementinformation and tools
Improve alignment ofcapital budgets andprogram plans withbusiness priorities
Improve alignment ofbusiness unitstrategies withenterprise strategies
Improve alignment offinancial strategieswith corporatestrategies
Strengthenenterprise-widefinancial reportingstandards
Increase focus onbusiness insight andforward-lookinginformation
Improve integration ofshort- and long-termbusiness planning
Improve leadershipand managementskills of executives
Increase emphasis oncontinuous, proactivemanagement ofinvestment portfolios
Improve vendormanagement skills ofstaff
Improve involvementof operational staff inproject delivery
Improveaccountability/authority of programand project resources
Improve effectivenessof program/projectgovernance models
Increase focus on keyperformance metrics
Increase focus onbusiness continuityplanning
Increase focus onproject quality andrisk management
Increase focus onrealization of targetedbusiness benefits
Improve identificationand management ofprogram/project risks
Continuously trackand manage therealization of projectbenefits
Structure programs/projects to deliverbenefits progressively
Improve access toand distribution ofperformanceinformation
Improveunderstanding ofpartner strengths,weaknesses andinterests
Improve ability tostructure andimplement durable,mutually beneficialpartnerships
Improve agility andflexibility of partnerorganizations andnetworks
Develop and utilizeunique productionresources(methods, equipment,facilities, etc.)
Rationalize/consolidate vendorportfolio
Improve coordinationof payments acrossbusiness units
Improve assessmentand benchmarking ofA/P performance
Refine days-outstanding strategy
Improve alignment ofA/P systems andprocesses with days-outstanding strategy
Refine credit/days-receivable strategy
Improve managementof credit risk acrossbusiness units
Improve managementof credit/loan portfolio
How Value is Created(Value Drivers)
What You Can Do(Improvement Levers: Business Processes,
Assets and Organizational Capabilities)
Other Shared / Corporate Services(Real Estate, Procurement and Other)
Human Capital Strategy and Management(Recruitment, Development, Administration and
Performance Management)
IT Strategy and Management(Design, Development, Deployment, Operations and
Performance Management)
Business Strategy and Management(Business and Financial Strategy, Mergers and Acquisitions, Tax
Management, Risk Management, Compliance Management, Program
Management and Performance Management)
Customer Strategy, Relationships and Interactions(Marketing, Sales, Delivery/Provisioning, Billing and Service)
Product Strategy, Development and Production(Innovation and Design, Supply Chain Management, Production
Operations and Logistics)
BUSINESS PROCESS GROUPINGS
All Process Groupings(Action may apply to all processes)
Change What You Do
- What you provide
- Whom you target and serve
- How you compete
- Where you deploy resources
- Which operations you outsource
Do What You Do Better
- Strengthen governance approaches
- Align resources with strategies
- Improve business processes
- Hone strategic capabilities
- Manage tax impacts and opportunities
- Improve control / reduce risk
- Collaborate more effectively
- Satisfy customers, employees and
other stakeholders
Note: Many actions could logically be associated with
other or multiple process groupings. For example,
many customer and product actions are likely to have
heavy IT and HR components.
Acquire New CustomersRetain and Grow Current
CustomersLeverage Income-Generating Assets
Strengthen PricingImprove
Customer InteractionEfficiency
Improve
Corporate/Shared ServicesEfficiency
Improve
Development & ProductionEfficiency
Improve
Logistics & ServiceProvisionEfficiency
Improve
PP&EEfficiency
Improve
InventoryEfficiency
Improve
Receivables & PayablesEfficiency
Improve
Management & GovernanceEffectiveness
Improve
Execution Capabilities
Marketing &Sales
AccountManagement
Cross-Sell/Up-Sell
RetentionDemand &
SupplyManagement
PriceOptimization
Marketing &Advertising
SalesCustomerService &Support
OrderFulfillment &
Billing
IT, Telecom &Networking
Real EstateHuman
Resources
Procurement(Excluding Production
Materials &Merchandise)
BusinessManagement
FinancialManagement
Materials Production MerchandisingLogistics &Distribution
ProductDevelopment
Real Estate &Infrastructure
Equipment &Systems
FinishedGoods
Work inProcess &
Raw Materials
Accounts,Notes &Interest
Receivable
Accounts,Notes &InterestPayable
BusinessPlanning
ProgramDelivery
BusinessPerformanceManagement
OperationalExcellence
Partnership &Collaboration
RelationshipStrength
Agility &Flexibility
Product &Service
Innovation
ServiceDelivery
Cash/AssetManagement
StrategicAssets
Volume Price RealizationSelling, General &
Administrative(SG&A)
Cost of Goods Sold(COGS)
Property, Plant &Equipment
(PP&E)Inventory Receivables
& Payables Company Strengths External Factors
Revenue Growth Operating Margin(after taxes)
Asset Efficiency Expectations
S h a r e h o l d e r V a l u e
Improve customerincentives foraccelerated/on-timepayment
Improve cross-selling/up-sellingskills of staff
Improve customerservice and retentionskills of staff
Increase focus onproduct innovation
Improve managementof trade/indirect taxes(sales/use, VAT, GST, etc.)
Improve tax collectionand remittanceprocesses
Improve managementof international staffcosts(immigration, payroll, staffsupport, international equity,etc.)
Utilize availablefederal, state andlocal employment/training incentives
Improve technologyand data riskmanagementprocesses
Improve compliancemanagementprocesses
Improve tax manage-ment processes(direct and indirect taxmanagement)
Optimize tax benefitsassociated with self-constructed assets(plant, facilities, internally-used software, etc.)
Improve managementof transfer pricing
Improve managementof trade and indirecttaxes (sales/use , VAT,GST, etc.)
Improve managementof transfer pricing
Improve incorporationof risk analysis inbusiness planning(internal and external risk)
Integrate tax oppor-tunities and issuesinto business planningprocesses
Improve identificationand mitigation ofoperational risk(people, process, tech-nology, data, etc.)
Improve quality ofinformation providedto stakeholders(accuracy, timeliness,transparency &predictability)
Develop and utilizeunique informationresources (customer,product, market, etc.)
Improve managementof organizationalchange in support ofinitiatives
Improve operationalrisk managementprocesses
Improve considerationof tax implications inthe acquisition anddisposition of assets
Maximize tax benefitsassociated with majorbusiness decisions(M&A, consolidation, out-sourcing, site selection, etc.)
Increase emphasis onpermanently loweringthe company'seffective tax rate
Improve accuracy andtimeliness of taxprovision and cashoutflow forecasts
Improve focus of taxfunction/departmenton proactive taxplanning
Integrate tax oppor-tunities and issuesinto business planningprocesses
Optimize accountingmethods and selec-tion of accountingperiods
Migrate income tolow-tax jurisdictions
Utilize internationalfinancing opportuni-ties to minimize after-tax borrowing costs
Optimize expense vs.capitalization of costs(M&A costs, R&D costs,etc.)
Improve identificationand application ofR&D tax incentives
Improve ability toutilize offshore cash/assets and movebetween geographies
Improve ability toutilize offshore cash/assets and movebetween geographies
Improve managementof transfer pricing
Improve ability toutilize offshore cash/assets and movebetween geographies
Ensure propervaluation of propertyfor tax purposes
Build tax opportunitiesinto real estatetransactions(income deferral, locationcredits and incentives,leasing terms, etc.)
Improve tax benefitsof compensation andbenefit programs(deferred and equity-basedcomp; retirement andhealthcare benefits, etc.)
Manage payroll taximpacts of businessinitiatives(M&A, consolidation,
restructuring, relocation etc.)
Optimize utilization ofavailable sales/usetax exemptions
Improve managementof indirect taxes(sales/use, VAT, customsduties, etc.)
Ensure adequatedocumentation ofsignificant taxpositions(earnings & profits, transferpricing, tax opinions, etc.)
Accelerate or deferincome/expenses
Clarify governanceroles and responsi-bilities (delegation ofauthority, segregation ofduties, etc.)
Implement/enhanceanonymous employeereporting and feed-back mechanisms
Align compensationand incentive systemswith strategies, valuesand ethics
Improve under-standing of regulatoryrequirements
Strengthen corporategovernance structures(composition, selection,
roles, etc.)
Strengthen training/education of boardand audit committees
Strengthen andcommunicate mission,vision, values andethics
Improve focus oninternal controls andregulatory compliance
Build values andethics into corporateculture
Increase emphasis onrisk identification andmanagement
Improve risk planning,mitigation and controlapproaches
Improve monitoringand management ofregulatory compliance
Improve company-wide monitoring andmanagement of risks
Improve identificationand assessment ofrisk (strategic, operational,investment, financial, com-pliance, data/privacy, etc.)
Improve monitoringand management ofrisk and compliance(strategic, operational andfinancial risks; regulatoryand tax compliance)
D e l o i t t e E n t e r p r i s e V a l u e M a p T M
(Practical paths to increase shareholder value)
It’s easy to say shareholder value is important.Not so easy to make it influence the decisionsthat are made every day: where to spend timeand resources, how best to get things done, and,ultimately, how to win in the competitivemarketplace.
This Map is designed to accelerate theconnection between actions you can take andshareholder value. It is not rocket science and itis not complete, but it can jump-start theprocess of focusing on the things that mattermost and then choosing practical ways to getthem done.
Here are two simple ways to use it:
Start at the top. Working your way down,
at each step ask yourself, How will we
improve this? This will help ensure that your
tactics support your objectives.
Start at the bottom. Working your way up,
at each step ask yourself, Why are we doing
this? This will help ensure that every tactic
leads to shareholder value.
Improve breadth,depth, quality andtimeliness of manag-erial information
Improve/implementinternal controlframeworks andpolicies
Strengthen andcommunicategovernance policiesand procedures
Align internal auditpractices withbusiness and riskobjectives
Improve communi-cation between theboard, management,shareholders and thepublic
Improve mechanismsfor collecting andimplementingemployee ideas
Build innovation andimprovement intorewards andincentives
Improve mechanismsfor soliciting andaddressingstakeholder feedback
Develop/integrateglobal HR practices(internal/external, onshore/offshore, etc.)
Income Taxes
Improve
Income TaxEfficiency
Income TaxManagement
Governance
Improve utilization oftelecom tax incentives(credits, exemptions, etc.)
Improve profitability ofR&D efforts throughutilization of tax andeconomic develop-ment incentives
Improve profitability ofR&D efforts throughutilization of tax andeconomic develop-ment incentives
Improve tracking andrecovery of indirecttaxes (sales/use, VAT,GST, etc.)
Ensure tax planningactivities and taxfilings comply withregulatory environ-ment
Increase account-ability of businessunit leaders for taximpact of decisions
Improve coordinationof operational, invest-ment, financial, M&A,and tax strategiesacross business units
Utilize tax-effectivecorporate structuresfor ownership/licens-ing of intangibleassets (patents, tradenames, IP, etc.)
Improve benchmark-ing of global effectivetax rate againstindustry peer group
Utilize tax opportuni-ties around risk man-agement activities(hedging transactions,commodities trading, etc.)
Defer and reducefederal, state andlocal quarterly esti-mated tax payments
Consider taxincentives in locationand selection offacilities
Increase focus onpost-merger synergyand cost reductionprograms
Improve breadth,depth, quality andtimeliness of businessplanning information
Utilize tax-effectivecorporate structuresfor ownership/licens-ing of intangibleassets (patents, tradenames, IP, etc.)
Develop and utilizeunique tax expertise
How to address Economic, Social and Environmental imperatives all together
Improve materials efficiency of production processes
• Design products that allow in-creased use of recycled materials: use procurement deals and partnerships to assure the quality and supply
• Return wastes to process for recycling, reuse or remanufacturing reducing the quantity of materials purchased and the cost of disposal
Improve Production Efficiency
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Seite 18 © 9/27/2005 Deloitte & Touche
•Rationalize and/or realign product development efforts •Increase emphasis on modular, extensible, scalable designs •Improve prototyping, piloting and testing processes •Ensure the use of recyclable packaging •Improve recovery, reuse, and recycling of packaging •Manage the entire product life cycle / products sold that are reclaimable at the end of the products’ life (recycle or reuse of the product materials or components)
Improve Development & Production
efficiency
Impro
ve P
roduct
&
Serv
ices C
ycle
How to address Economic, Social and Environmental Imperatives all together to create Shareholder Value
Seite 19 © 9/27/2005 Deloitte & Touche
Shareholder Value Tracking of Sustainability Issues
Even if aligned with
the objectives, these
projects may double
count benefits
Many issues appear
to have negative
financial return
The company
objective is to
increase Grow
Constituent Base by
10%
Add sensitivity
analysis, if
available
However 70% of the
portfolio is focused
on Asset Efficiency
Seite 20 © 9/27/2005 Deloitte & Touche
Design Business Case
The ValuePrint Approach focuses on how to develop a business case using ValuePrint. In the broader context of Deloitte’s commitment to provide professional services that deliver measurable business value, the Path to Value method represents an approach to managing the engagement life cycle to target, identify, and deliver value-creating opportunities for our clients. The ValuePrint Approach is included in the Path to Value method
The ValuePrint Approach
Assess Client
Strategies and
Issues**
Develop Business
Case Scope
Statement
Conduct Business
Case Financial
Analysis
Develop Business
Case Workplan
Prepare Business
Case Executive
Report
Monitor Result
1 2 3 4
Initiation
Monitoring
€
Seite 21 © 9/27/2005 Deloitte & Touche
Components of The Value Methodology
Enterprise Value Map: provides a simple conceptual framework that relates client issues and activities to shareholder value; a powerful visual interface for discussing how actions and strategies align against value drivers.
ValueAnalytics: provides user friendly but rigorous financial analysis, both over time and compared to client competitors, across key value drivers.
ValueLink: is an on-line portal which provides access to firm thought leadership and intellectual property using the Enterprise Value Map framework as the primary navigation approach; helps match Deloitte capabilities to client issues
ValuePrint: is a business case development tool which aligns to the Enterprise Value Map structure; financial impact templates (FIT’s) reside in ValueLink and are assembled into consolidated project business case
MapIt (part of Portfolio Landscape): is a simple tool that provides a quick portfolio view of projects (ours or others) and illustrates how they align against client issues and strategy as they are mapped onto the Enterprise Value Map.
Portfolio Landscape: is a service offering and approach that provides a rigorous portfolio view of a companies programs/projects, relating them back to the Enterprise Value Map, showing how they align against company strategy, needs and priorities.
The Value Initiative e-Learning CDROM: is a multi-media learning program which provides more detailed awareness and learning related to the use of The Value Initiative enablers
Value Based Billing: is a means of establishing a value-based pricing and deal structure on selected projects
Value Tracking: is a means of identifying, tracking and communicating value delivered to the client
Seite 22 © 9/27/2005 Deloitte & Touche
The Path to Value
Seite 23 © 9/27/2005 Deloitte & Touche