Introduction

“Before anything else, preparation is the key to success.”

– Alexander Graham Bell, Scottish-born Inventor and Engineer

How can you prioritize all the possible steps you can take to increase the value of your business?

The Return on Value Driver’s Model, also known as the RVD Model, is a proprietary tool I developed that helps you identify which aspects of your business to focus on improving that are likely to have the greatest impact on the value of your company. The goal of the RVD Model is to help you increase the value of your business with the least amount of effort.

What is a value driver? A value driver is any action you can take that can potentially affect the value of your business. For example, the most sought-after top value driver for technology, software, and online businesses is recurring revenue. If you know this is the top driver of value for your business, you can prioritize this value driver over others that will have a less meaningful impact.

The RVD Model helps you prioritize which value drivers to focus on based on the following criteria:

• Return: What’s the potential impact, or return, of implementing the value driver on the value of your business?
• Risk: What’s the risk associated with implementing the potential value driver?
• Time: How much time will the value driver take to implement?
• Investment: What financial investment is required to implement the value driver?

The RVD Model helps you determine which action steps will have the largest impact on the value of your business in the shortest time that represent the least amount of risk to implement. In this section, I walk you through a step-by-step process for deciding which aspects of your company to focus on improving first. I also provide a sample RVD Model based on a real company.