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Creating Value & Capturing Value

Are you creating values throughout your digital transformation journey? If yes, great. Now that you have created values, are you capturing values or not? Creating values without values captured on a sustainable basis could be a short-lived transformation.

All digital transformation initiatives are to create values for the organization. The intent is to leverage technologies to enable the creation of values from, for example, enhancing products and services, building brand and customer loyalty, establishing an effective supply chain distribution network, optimizing operations, or developing people excellence. We need to define the values that we aim to create for each segment that we are targeting. In other words, as a design thinking practitioner, I see this as a user-centered approach to creating value for the people we are designing solutions.

Besides defining the values that we aim to create for each initiative, we must determine the value capture for each value creation. The realization of value capture may be immediate or over some time. Value capture could mean monetization of value created, or savings realized, or margins generated, or liquidity generated.

Of course, the real value needs to be created to capture the value. We, therefore, need to be cautious of creating and capturing the artificial value of which could be detrimental to the business.

In conclusion, it is vital to recognize that both creating and capturing value is necessary for your digital transformation journey. You could be focusing on creating value at the early stages of transformation, and as sustainable value is created, you need to shift your attention to capturing that value. Even while you are capturing value, you should stay continually focused on creating value, or the ability to capture value will be short-lived.

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