Value Creation Plans
A value creation plan is a strategic document that outlines how a company intends to increase its value. It typically includes a detailed analysis of the company's current financial performance, as well as a roadmap for how the company plans to improve its performance in the future. Value creation plans can be used by companies of all sizes, in all industries. There are many different ways that a company can create value. Some common value creation strategies include:
Improving profitability: Companies can increase their value by improving profitability across a number of metrics including by segment, sector, channel, customer, SKU etc. To do this you need to understand how revenues and costs are allocated across each of these metrics via a more comprehensive understanding of your data;
Increasing revenue: Companies can also increase their value by increasing their revenue. This can be done by expanding into new markets, developing new products or services, growing sales channels, or increasing prices;
Reducing costs: Companies can increase their value by reducing their costs. This can be done by streamlining operations, negotiating better prices with suppliers, or outsourcing non-core functions;
Improving efficiency: Companies can increase their value by improving their efficiency. This can be done by investing in new technology, streamlining processes, reducing non-profit making segments, sectors, channels, customers, SKUs or customers, improving working capital including cash collection of overdue debt, improving employee productivity, etc;
Building a strong brand: Companies can also increase their value by building a strong brand. This can be done by investing in marketing and advertising, providing excellent customer service, or developing a reputation for innovation.
Value creation plans are an important tool for any company that wants to increase its value. By carefully considering all of the potential value creation strategies, companies can develop a plan that is tailored to their specific needs and goals. Here are some of the benefits of having a value creation plan:
It can help you identify and prioritise opportunities for improvement;
It can help you track your progress and measure your results;
It can help you communicate your strategy to your stakeholders;
It can help you attract new investors and partners;
It can help you prepare for a sale or merger.
If you are not already using a value creation plan, we encourage you to consider developing one. It could be the key to unlocking your company's full potential.
The Value Creation Partnership has helped several companies turn a corner from a period of declining revenues and profits including Arco Group in 2023, a £300m experts in safety company based in Hull where we led a team of over 40 colleagues in their first phase of value creation planning. Rest assured we are here to help and minimise the impact within your business wherever possible.
If you would like to learn more about how The Value Creation Partnership can help your organisation flourish, become more efficient and ultimately more profitable, please complete the short form below and we will be in touch.
6 simple steps to creating a Value Creation Plan
Onsite Visit
This is our opportunity to better understand the company's needs, including various goals, challenges, pain points and future strategic aspirations. It is face to face and on site with your senior leadership team and our functional experts including ex-CEOs, CFOs, COOs, CROs etc and culminates with a written presentation from us to you highlighting a 6 - 8 week schedule of works to create the VCP.
Initial Online Consultation
The first step is typically a video call between one of our Value Creation Partners and a board sponsor of your company (could be the Chairman, CEO, CFO, investor, etc). It will last between 30 minutes and 1 hour and is an opportunity for us to discuss at a high level the challenges you are facing and looking to overcome. If appropriate, we then look to arrange the second stage which is an onsite visit for 3 - 5 days.
Step 1
30 mins - 1 hr
Step 2
3 - 5 days
Present VCP to stakeholders
Once we have developed a VCP, we present it to the company. This presentation should be concise and clearly articulate the 100-day execution phase and the value that the plan will create for your company, detailing when you will start to see noticeable differences in the business operations, efficiencies, cashflow and ultimately profits. We also use this time to agree resources, budgets, timescales, fees and contracts.
Develop the VCP
The next step is for us to develop a value creation plan. This plan should outline the approach to creating value for the company. It should include specific goals, strategies, and metrics for success including what the 100-day execution stage looks like and what it aims to achieve. To do this we will typically require a number of your internal resources to be seconded to the VCP team and fair access to senior colleagues.
Step 3
6 - 8 weeks
Step 4
3 - 5 days
Seeing it Through
At this stage, we would generally be less involved in your business as a full team and on a full time basis, except where requested to stay on and see through projects such as systems implementations etc. Our focus shifts to supporting your internal colleagues with any necessary upskilling or training in delivering the rest of the plan, however, we are always on hand to support any further value you require support in creating.
100-day Execution Phase
This is the most important and intense period of the execution phase and undoubtedly the most complex; utilising a blend of internal resources who will be seconded to the programme, our external functional experts and 3rd parties where appropriate to deliver this critical stage of the VCP. This is often the turnaround phase for many business and you should see noticeable differences in your operations and financials.
Step 5
100 days
Step 6
1 - 12 months
Get in touch
If you would like to speak to us regarding any suport you may require, please complete this form and one of our representatives will be in touch, alterntaively you can reach us by email at info@thevcp.co.uk.