Transcript enlarging value paradigm

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Evolutionary Economics
Improved Metrics for better Value Maps
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Evolutionary Economics
© 2006 Peter Bretscher, Eggersriet, Switzerland – [email protected]
© 2006 bengin.com
eve02_e
Possible to
calculate with and
visualize 2D-Values
Development of (economic) Value-Metrics
(Compound Value-Metric System with the subjective, implicit Value axis)
Why Metrics?
- comparing, comprehensible, reproducible
- Making rationale (and indirect) communication easier.
% i$
% i$
Strong need for
interpretation
Measures reduce need
for interpretation
$
3. Quantitative
Metrics
(2, 3, n-dimensional)
(linear)
$
$
$
2. Qualitative
Metrics
hot, cold ...... AAA, A+, B, C
1. Normative "Metrics"
Principles, ....The xx "Commandments"
Difficult to visualize.
No tools and rules
for numerical or
graphical
calculations.
Axis of time
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Evolutionary Economics
© 2006 bengin.com
Objects, Properties, Value-Measures
Resources
Objects
Explicit values
Numbers
tangible
intangible
Real
Numbers
Unit:
SFR, $, €
Objective Numbers
Unit:
iSFR, i$, i€
Subjective Numbers
Imaginary
Numbers
Implicit values
Complex
Numbers
Unit:
SFR/iSFR, $/i$, €/i€
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combined
Vector
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Evolutionary Economics
© 2006 bengin.com
Subjective Value/Benefit, weigted*)
Evolutionary Economics
*) relative
[%] or
absolute [i$] Metric System
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Vector as a Compound Value Metric
for Arithmetic in Behavioral Finance,
strategic controlling, risk management..
"Objective" Value [$]
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Evolutionary Economics
© 2006 bengin.com
Intangible Assets or Shareholders Profit Expectation?
implicit
value
[i - Mia]
Coca-Cola
80
75
The explicit Value and the implicit
Value together draw a complete
picture about the company’s value
and its development.
70
65
60
55
IBM
Microsoft
50
45
The question remains:
Is the implicit Value given by the
real Value of the company?
Is it given by some marketing tricks?
Which part of it is made by the
Shareholders Value Expectation?
40
35
30
McDonald's
25
Ford
20
15
10
5
5
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10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
explicit value
[Mia]
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Evolutionary Economics
© 2006 bengin.com
A better model for new decisions
Value Points of 75 enterprises
10'000
Investors: Attention!
9'000
8'000
implicit Values
7'000
6'000
5'000
4'000
3'000
2'000
Management could use the
potential more effective.
1'000
0
0
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1'000
2'000
3'000
4'000
5'000
6'000
explicit Values
7'000
8'000
9'000 10'000
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Evolutionary Economics
© 2006 bengin.com
Tracking the development of an enterprise
Pointer of vector for five years
1'400
92
1'200
implicit axis [ Mio iCHF]
1'000
93
800
Question:
"What happened in the year 1996?“
95
Answer:
Part of enterprise sold.
94
96
2nd Question:
Is this loss of intangible values compensated by the price received for the sold
part of enterprise.
600
400
200
Answer: ?
0
0
200
400
600
800
1'000
explicit axis [Mio CHF]
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1'200
1'400
1'600
 Ask Auditor – if he’s still available….
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Evolutionary Economics
© 2006 bengin.com
14 types of industry (Sveiby)
iV
400.00
350.00
Food
300.00
Media
Services
Electronic
250.00
Information Technology
Mechanical Industries
Insurance
200.00
Steel
Electricity, Gas
Wood Industries
150.00
Bank
Automobil
Real estate
100.00
Health
50.00
0.00
0.00
20.00
40.00
60.00
80.00
100.00
120.00
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Source: Morgan & Stanley Capital International World Index; Cited in: Sveiby, Wissenskapital; Seite 23; Mi-Verlag 1998
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Evolutionary Economics
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Overpriced Papers? Is the Vector a prognostic tool?
....a year before the downturn of the classic curve....
...the Vector Map indicated a change of Coca Cola Amatil.........
Value Vector
Stock Exchange Value
9000000000
12000000000
10000000000
97
8000000000
97
96
98
6000000000
99
4000000000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
2000000000
0
1992
6000000000
Implicit Values
8000000000
1991
96
7000000000
1990
1993
5000000000
98
4000000000
1994
1995
3000000000
1996
2000000000
1997
1998
1000000000
99
0
0
1999
2E+0 4E+0 6E+0
9
9
9
Explicit Values
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Evolutionary Economics
© 2006 bengin.com
The four Quadrants of Value generation
+I
in
QI
Q I: Transform -M / +I
- New projects
- Revisions of Offerings
- Insourcing/merging
-
Q II
R&D
Transformation
(M to I)
-M
Value
Generation
in
out
+M
Transformation
(I to M)
Value
Degeneration
Q IV
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Q II:Generation +M / +I
out
-I
Q III
- Daily business
- Selling, dispatch
- (Re)Production
-
Q III: Transform -I / +M
- Outsourcing
- leaner
-
Q IV:Degeneration -I / -M
- Graveyard
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Evolutionary Economics
© 2006 bengin.com
Economic Value Architecture & Engineering
Intangible
Economy
mV [$]
Classic
Economy
Next Economy
I
Enterprise
M
Intro
iV for
implicit Value
(tangible)
(intangible)
Stock
exchange
Time
Balance
Balance
iV [i$]
M
REV(Real Enterprise Value)
(tangible)
iV
REV + SPE = TEV
)
In & out
Structure*
(intangible)
SPE(Shareholders Profit Expectation)
In & out
I
mV [$]
TEV = Total Enterprise Value = “Shareholder Value”
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Value Track
iV [i$]
*)
Structure as proposed by:
Balanced Scorecard and other
existing Solutions for
structuring (intangible) Assets.
We recommend BE-Systems.
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Ic-Function
(Ortskurve, TEV)
mV [$]
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Evolutionary Economics
© 2006 bengin.com
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Beyond Limits of Classic Business Paradigms
Thank You
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(re)cognising real Values, mapping, developing, using, tracking….
Evolutionary Economics
© 2006 bengin.com
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