Layer 1: Creating Value

Updated: Oct 29, 2019



Getting value creation right makes all the difference. Here's why:

Building a high performance growth machine in your company begins and ends with value. First, the growth machine creates value, next conveys value, and finally captures value.


We see it again and again. Businesses that thrive create value from their customer’s perspective. They solve important problems or create new growth opportunities for their customers. Get this part of the growth machine right and options to grow and build market dominance multiply. Get it wrong and every other part of the growth machine is weakened.


Creating value is the role of the first layer of the growth machine and its three elements — Vision, Firm, and Offers. Creating value is not just where most entrepreneurs begin; it is the source of a company’s resiliency and market power.


What is the quality of value your company is creating? In what ways does it really resonate with customers, and with your team? How is your firm creating value?



Value Creation Starts With Vision


In the growth machine, value creation starts with Vision. Vision can be understood as the aspirational portrait that drives your business forward. Vision’s clarity arises from your firm’s “why” and “what success looks like.” A Vision’s power emerges from its use to guide decision-making every day.


Improving your team’s responses to the following four questions will go a long way to grounding your firm’s value creation in a powerful vision:

  1. What is your firm’s “Why?”

  2. What does “success” look like for your firm?

  3. Is your firm’s “Why” and understanding of “Success” understood by every employee in the company?

  4. How do you use your firm’s Vision to guide strategy and decisions every day?



Creating Value Continues With The Firm


While value creation begins with inspiration and aspiration, value creation becomes tangible through the “Firm” element of the growth machine. Why? Because the Firm organizes how your ideas are put into practice. The Firm is the vehicle that enables a Vision to become a reality.


Of course, there are quite a few components of the Firm that directly impact how value is created: team, culture, strategy, resources among them. A fundamental metric for a gauging how effectively a Firm creates value is: “The right people are doing the right thing in the right way for the right reasons.”


With your team, use these four questions to assess your Firm’s value creating prowess:

  1. How well are your team’s activities focused and aligned to achieve the Firm’s Vision?

  2. Does everyone understand the firm’s Business Model and agree with its core Growth Strategy?

  3. How does the Firm’s Culture generate the desired values and contribute to achieving the desired growth?

  4. What are the gaps between the Firm’s capabilities and resources, and its aspirations?



Creating Value Manifests Itself In Offers

Both the tangible and intangible pieces of the value-creation process are crucial to your business’s success: both the inspiration for the business, and the sweat and grind of making your vision a reality. Without one, you can’t have the other.


This brings us to Element #3, the final element in the value creation layer of the growth machine. “Offers” is how your firm connects its value-creation process with the end-user, the consumer. Importantly, while value is created by the Firm, value is determined by consumers, by those it serves. Thus producing valuable offerings requires that two conditions be met. First, that your Firm is really good at producing what it is offering. And second, that end-users really recognize how your firm’s offerings meet their needs, and help them succeed.


Five questions your team can use to improve the value of your firm’s Offers are:

  • What Offer can your business be “best in the world” at providing?

  • What most sets your Offer apart from others, and why does this matter?

  • Who does the Offer matter to, and why?

  • In what ways does your Firm excel in delivering the products/services that your customers care about (i.e. value) most? (think this is just repeating point two)

  • Which of your Offers are the most profitable for your business?


In our assessments of dozens of companies, those firm’s with High Performing Growth Machines invariably have a compelling Vision, a healthy Firm, and valuable Offerings. All three value-creation elements of the growth machine are solid and aligned. Get these elements right, and the rest of the growth machine operates much more smoothly.


We’ll be digging into the other growth machine elements in future posts. Stay tuned.

Finally, want to strengthen the value creation layer of your business's growth machine? Get customized growth suggestions with our free growth audit.

©2019 by Shepherd Advisors