Architecture Financial Measurement
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2018-06-26T20:38:18+00:00
Many branding agencies focus on appearance. They specialize in creating trademarks, look and feel, positioning, messaging, and they do think about customer value. In turn, many management consulting organizations focus on generating greater shareholder value by utilizing capital more efficiently, often with little regard for customer value. This results in downsizing, business process outsourcing, and financial re-engineering. In contrast, Enterprise Value Integration (EVI) works closely with organizations to create value for both shareholders and customers. Process + Financial Analytics on Customers is one of the greatest breakthroughs of EVI. It enables our clients to better understand where value is lost, and identify opportunities to improve internal operations to generate more value, while also keeping Brand Promises.
In the absence of meaningful metrics at their disposal, brands have turned to KPIs such as Total Lifetime Value (TLV) and Net Promoter Score (NPS). Perception drives NPS and has little correlation to shareholder value. TLV is based on top line revenue and does not factor-in costs. EVI introduces Total Lifetime Profitability (TLP) to enable improved shareholder value and customer value. By analyzing consumption of resources by each customer, marketers can segment customers more accurately. And BPM practitioners can optimize business processes to enable each to meet the needs of each segment. TLP does create a need to utilize significant compute resources to measure and track customers at the individual process level. However, Cloud Computing is ideal to spin-up resources and store data efficiently.
The left side of the pyramid illustrates the principles of Business Architecture, in which Strategy inspires Business Models, which in turn define Business Processes. Enterprise Value Integration (EVI) introduces two new breakthroughs in this realm. First, EVI aligns Brand Architecture (right) with Business Architecture. Secondly, EVI designs and implements financial analytic systems to measure inputs, transformations, and outputs associated with each business process and each customer segment. This enables brand promises to be met in a more sustainable and profitable way.
The right side highlights EVI’s approach to Brand Architecture. Strategy is closely associated with Positioning. Business Model is correlated with Brand Promises. Business Models have a significant impact on Customer Experience(s). Business Architecture is structured around internal systems, such as cloud computing infrastructure. Brand Architecture is innately external. EVI is passionate about each customer’s interactions because experiences are essential to earning loyalty, upselling additional services/products and building equity.
