# Value Creation Consulting Workflow Build a value driver tree model step by step, the way consultants find and size value By Login Inutili Topic: Society & Business [Open the interactive Jig](https://ask.jig.com/j/hFNPunWEx7kU) ## Guide ### 1. Value Creation Consulting Workflow Consultants help a company grow its value by finding what really drives it\. You will build that as a model called a value driver tree, a map of what pushes value up, for a made\-up car\-parts seller, CarPro Market\. All the parts are laid out\. Tap any part to see its name\. Drag to turn the model\. ### 2. 1 · Place the Company Profile Every job starts by getting to know the company\. CarPro Market is mature, meaning it is long established, and it sells car parts to shoppers and to other businesses, in stores and online\. Its three spots stand for its life stage, its sector and its risks, such as tariffs \(taxes on imports\) and fake parts\. ### 3. 2 · Stand the Three Driver Pillars Push the pillars into their holes\. They are the value drivers: things managers can change to grow value\. Almost every one comes back to three groups: bringing in more money \(revenue\), spending less \(cost\) and freeing up cash\. ### 4. 3 · Lay the Financial Indicators Beam Rest the beam across the pillar tops\. It stands for financial indicators, accounting numbers such as profit and working capital, the cash tied up in stock and unpaid bills\. Managers cannot move these directly; they only rise when the pillars below are improved\. ### 5. 4 · Crown It with the Key Result Set the gold crown on the beam\. It is the target indicator: the single key result the whole tree serves, such as EBITDA, which means earnings before interest, taxes and other accounting charges\. ### 6. 5 · Raise the External Factors Arch Lower the arch behind the tree\. Its beads are outside forces like exchange rates, interest rates and new laws\. The company cannot control them, but they still push its value up or down, so consultants keep an eye on them\. ### 7. 6 · Plug In the First Opportunity Press the top peg into the revenue pillar\. Each peg is a value creation opportunity, an idea worth testing\. This one is dynamic pricing, changing prices as demand changes, which could lift results by about 2 to 6 percent\. ### 8. 7 · Plug In the Other Eight Press in the rest the same way: product mix and new channels on revenue, a simpler supply chain \(how parts reach the shops\), outsourcing \(paying other firms for support work\) and better buying on cost, and getting paid sooner and better forecasting on cash\. Tap a peg to see its likely gain\. Outsourcing support work has the biggest range: 5 to 10 percent lower cost\. ### 9. 8 · Set the Analytics Funnel Place the funnel in front of the cash pillar\. Analytics, careful study of data, checks each idea with real numbers: data is collected from many sources, cleaned and organised, and turned into insights and starting figures, called baselines\. ### 10. 9 · Fit the Result Gauge Set the gauge at the front\. Two kinds of parts take about 65 percent of what CarPro spends with suppliers\. Buying from fewer, stronger suppliers saves 1 percent in the base case, about $0\.1 million a year\. A stretch case saves 3 percent, about $0\.3 million\. ### 11. Done Your value driver tree is complete\. The workflow runs bottom to top: know the company, map its drivers, spot opportunities, test them with data and size the prize\. Turn the model to explore it, and tap any part to remember what it means\.