Organization Design to Value-driven decision-making and AI-supportive initiatives

Building a value interface access to have a good work value proposition.

Value interface access (VIA) is a framework that helps organizations prioritize, allocate, and optimize resources to create value for customers. By building a VIA, organizations can have a good work proposition for a number of reasons:

• Improved customer satisfaction by delivering products and services that better meet their needs
• Enhanced operational efficiency by reducing waste and improving processes
• Increased employee engagement by providing clear direction and purpose
• Greater financial performance by prioritizing resources toward value-creating activities
• VIA provides a holistic view of the organization and helps to align everyone around the shared goal of creating value.

A vague definition of value is a common issue in teamwork,

The deal when a team doesn’t have a clear and shared understanding of what “value” means, it can lead to:

• Misaligned priorities and goals
• Conflicting viewpoints and decisions
• Lack of clarity and focus
• Missed opportunities and wasted resources
• Frustration and confusion among team members

Without a clear definition of value, it’s like everyone is speaking a different language. It’s hard to get on the same page and make progress towards a common goal. It’s like trying to build a house without a blueprint – chaos ensues!

Organizational value streams have difficulties in keeping focus on customer value.

A lot of organizations tend to get caught up in their own internal processes and metrics, and lose sight of what really matters – the customer! Reasons why this can happen:

• The pressure to hit internal targets and KPIs can overshadow customer-centric objectives.
• Internal silos can prevent a holistic view of the customer experience.
• The pace of change can make it challenging to keep up with evolving customer needs and expectations.
• Internal politics and bureaucracy can stifle innovation and customer-centric thinking.

In short, it’s easy to get bogged down in the weeds and forget about the big picture – what really drives success is a relentless focus on creating value for customers!

The OKR (objective key results) method doesn’t address all value dimensions that are necessary breakdown into organization initiatives.

While OKRs can be a powerful tool for aligning teams and driving focus, they don’t necessarily capture all the dimensions of value that an organization should be considering. Here are some of the ways OKRs fall short:

1. They tend to focus on quantitative metrics, rather than qualitative ones like customer satisfaction or brand reputation.
2. They can prioritize short-term goals over long-term strategic objectives.
3. They don’t necessarily consider the impact of initiatives on different stakeholders, like employees or partners.
4. They can create a narrow, goal-oriented mindset that overlooks broader organizational values and vision.

In short, OKRs can be useful, but they shouldn’t be the only tool in an organization’s arsenal for driving value.

The fully value-driven with some additional factors that organizations should consider to be truly value-driven:

• A clear and compelling vision that articulates the organization’s purpose and impact on society.
• A strong culture that emphasizes ethical decision-making, transparency, and a focus on customers.
• A holistic view of value that includes not just financial metrics but also social, environmental, and cultural impact.
• A commitment to continuous learning and improvement, including the ability to adapt and evolve based on changing market conditions and customer needs.
• An emphasis on collaboration, both internally and externally, to drive innovation and achieve shared goals.

In essence, being truly value-driven means having a clear and ambitious vision, a culture that aligns with that vision, and a willingness to continuously learn and evolve.

Some strategies to identify business opportunities while maintaining a value-driven approach are:

1. Collect and analyze customer feedback and data to understand their pain points and needs.
2. Monitor industry trends and technological advancements to identify emerging opportunities.
3. Collaborate with partners and stakeholders to gain new perspectives and insights.
4. Experiment with new products, services, or business models through pilots or experiments.
5. Encourage an entrepreneurial mindset within the organization, where employees are empowered to identify and pursue new opportunities.

The key is to stay curious, stay agile, and constantly scan the environment for new value-creating opportunities.

Keep an eye on external threats that are making fall your value definitions propostion. Then, external threats can definitely undermine your value proposition. Examples of external threats include:

• Competitive pressures, including new market entrants or competitors offering similar products/services at lower prices.
• Regulatory or policy changes that create barriers to your business.
• Economic downturns or shifts in consumer behavior that impact demand for your products/services.
• Technological disruptions, such as new technologies that render your offerings obsolete.
• Reputational risks, such as negative press or customer complaints that damage your brand image.

The key is to have a proactive risk management strategy in place to anticipate and mitigate these threats. Have a great dashboard mapping it all and constantly update on the values cycles.

A value dashboard could be beneficial:

1. It provides a high-level view of your value proposition and how it aligns with customer needs and market trends.
2. It helps you identify areas of strength and weakness in your value proposition, so you can prioritize efforts accordingly.
3. It enables you to track progress toward your value goals and make data-driven decisions about the direction of your business.
4. It allows for easy communication of value to stakeholders, both internally and externally, which can help with alignment and buy-in.

A value dashboard is like a map that keeps you on track towards delivering maximum value to your customers and stakeholders.

Usually, value changes and mostly can’t be realized the whole impact and the backpropagation. The infamous issue of value change can be difficult, because the value is dynamic and can change over time as market conditions, customer needs, and technological advancements evolve.

The backpropagation, which is a machine learning technique for adjusting model weights, may struggle to accurately capture these changes if the training data is not updated to reflect the new value function. Without it we can lead by a model that performs poorly, because it’s still making decisions based on outdated information. So, to maintain model accuracy and avoid the backpropagation “drift” issue, it’s crucial to continually update the training data to reflect the latest value function, by using AI to have a holistic view of all major values for organization, customers and the impact on control of initiatives.

AI can be a powerful tool for gaining a holistic view of all major values in an organization. Here’s how:

• AI can process large amounts of data from multiple sources (e.g., customer feedback, sales data, social media) to identify patterns and correlations that might not be apparent to humans.
• AI algorithms can analyze and visualize relationships between different values, such as customer satisfaction and sales, or employee engagement and productivity.
• AI-powered predictive analytics can forecast the impact of different initiatives on key values, allowing organizations to make informed decisions and measure the success of those initiatives.
• By leveraging AI, organizations can gain a more comprehensive and dynamic understanding of their values and the impact of their initiatives.

A kind of data that we should mostly keep the focus on and that can be useful for controlling initiatives are:

1. Performance metrics – tracking progress towards goals, such as sales growth, customer retention, and operational efficiency.
2. Financial data – monitoring budgets, revenue, expenses, and profit margins.
3. Customer feedback – analyzing reviews, surveys, and social media mentions to understand customer satisfaction and areas for improvement.
4. Employee engagement data – monitoring satisfaction, motivation, and productivity.
5. Competitive intelligence – keeping tabs on industry trends, competitor strategies, and market conditions.

By regularly monitoring these data points, organizations can proactively identify issues, make adjustments to initiatives, and ensure that they are achieving their desired outcomes.

And company capacity and skill set are also crucial.

• Capacity: Having a clear understanding of your company’s production or service capacity can help you avoid overcommitting and underdelivering. This can impact customer satisfaction and loyalty and, ultimately, revenue.
• Skill set: Staying on top of your team’s skills and capabilities is crucial for effective resource allocation and project planning. It allows you to match the right people to the right tasks, maximizing productivity and minimizing the risk of errors or delays.

At the bottom line, keeping a close eye on capacity and skill set is a must-do for any organization that wants to stay competitive and achieve its goals.

AI also can support companies to have foresight to skill set, current organizational capacities and dashboard of key indicators to ensure mostly value-driven management.

• AI can help predict the skills and capabilities required for future projects, allowing organizations to identify and invest in training and development opportunities. 📚
• AI-powered dashboards can provide real-time insights into current capacities and resource utilization, enabling managers to make informed decisions about project planning and resource allocation.
• By using AI to monitor key indicators like customer satisfaction, employee engagement, and market trends, organizations can ensure that their decisions and actions are aligned with their values and strategic objectives.

In short, AI can empower organizations to be more proactive, efficient, and effective in their management practices, ensuring that value is at the center of everything they do.

In the market, there are many AI systems to address it:

1. Workforce planning and optimization tools like Visier and Workday Adaptive Planning can help organizations forecast staffing needs and identify skills gaps.
2. Predictive analytics tools like Tableau and Microsoft Azure can provide real-time insights into performance metrics and market trends.
3. Natural language processing (NLP) tools like IBM Watson and Google’s Cloud Natural Language can help extract insights from customer feedback and other text-based data sources.

These systems can provide valuable insights and recommendations, freeing up managers to focus on more strategic and value-adding activities.

But when we consider organizational initiative development that has the requirement to keep under value definition control, some AI systems most used are:

1. Project management tools like Asana and Trello, which use AI to automate task assignments, monitor progress, and provide insights into team performance.
2. Risk management tools like Aravo and MetricStream, which use AI to identify potential risks and provide real-time alerts and recommendations.
3. Agile management tools like Jira and Rally, which use AI to facilitate sprint planning, backlog prioritization, and release management.

These tools help organizations ensure that their initiatives are aligned with their values and goals and that they are being executed in the most effective and efficient way possible.

When we implement AI tools and value-driven management we can change completely the organizational structure and team topology because teamwork can be focused on the value chain and the delivery approach. Shifting from the hierarchy model to the network model. And that’s a big shift, but it’s definitely doable! Some steps for making this transition:

1. Start with a value chain analysis to identify the key activities and processes that create value for the organization.
2. Reorganize teams around these value-creating activities, rather than traditional functional silos.
3. Promote cross-functional collaboration and knowledge sharing to break down organizational silos and create a more networked structure.
4. Implement agile methodologies like Scrum or Kanban to facilitate team collaboration, rapid iteration, and continuous improvement.
5. Empower teams to make decisions and take ownership of their work, rather than relying on a top-down hierarchy.

With these steps, you can move away from a traditional hierarchical structure and towards a more networked, value-driven organization.

Overall, it’s important to approach the transition with patience, clear communication, and a focus on employee engagement. Change can be tough, but it’s worth it in the long run!

You can say that Value-driven management, combined with the power of AI, creates a virtuous cycle.

• AI provides insights into customer needs, market trends, and operational inefficiencies.
• These insights inform value-driven decisions and actions.
• Value-driven actions drive better outcomes, which generate more data.
• The data feeds back into the AI systems, improving their ability to provide even better insights.

And the cycle continues! It’s a beautiful thing, really.

Shitf from Goals/Outputs to Value has impacted organizations on delivery approach and the role of VMO – Value Management Office become more important.

1. Drive value-focused decision-making across the organization.
2. Monitor value delivery and track progress toward value objectives.
3. Facilitate cross-functional collaboration and break down silos.
4. Provide training and coaching to embed value-driven thinking and practices.
5. Measure and communicate the impact of value-driven initiatives, both internally and externally.

Basically, the VMO is the “keeper of the value flame,” ensuring that value is always top of mind and baked into everything the organization does.

Of course, that Organization Design has to be adapted to it, too! Suitable for:

• Flatter, more networked structures that promote agility and collaboration are better suited to value-driven decision-making.
• A focus on skills and capabilities, rather than roles and titles, allows for more fluid and flexible teams.
• A decentralized, empowered approach gives employees the autonomy and accountability to drive value creation at all levels.
• A learning and innovation-focused culture creates the conditions for experimentation and growth.

And from the people side of the coin, the individual and the organizational culture, to become more flexible to value-driven and enabling innovation, some key ways are:

1. Promote a growth mindset and cultivate a culture of learning and experimentation.
2. Encourage cross-functional collaboration and knowledge sharing.
3. Emphasize a bias for action, and encourage individuals to take calculated risks and fail fast.
4. Provide opportunities for employee development and growth.
5. Celebrate and reward innovation and creativity.
6. Encourage open communication and a feedback culture.

By fostering these qualities, individuals and the organization can be more adaptable and innovative in pursuit of creating value for all stakeholders.

However, in the bottom line, the money has to emerge as a reward for the labor effort, then some indicators of money should be combined into value-driven decisions, such as:

• ROI: Return on Investment. Is the value created worth the cost of the investment?
• CAC: Customer Acquisition Cost. How much does it cost to acquire a new customer?
• CLV: Customer Lifetime Value. How much value does a customer bring over their entire relationship with the organization?
• CX: Customer Experience. Are customers satisfied with their experience, and how likely are they to recommend the organization to others?
• MRR: Monthly Recurring Revenue. How much predictable revenue does the organization generate each month?

Combining these indicators with a deep understanding of customer and market trends can help organizations make informed, value-driven decisions.

But remember, the divergencies between peoples to value alignment comes from:

• Different perspectives: Different people may have different beliefs, priorities, and experiences that shape their understanding of value.
• Limited visibility: Some people may not have a clear view of the whole picture, which can lead to disagreements about what is valuable.
• Conflicting interests: Sometimes, people’s individual interests or goals may conflict with what is best for the organization as a whole.
• Communication challenges: Misunderstandings or miscommunications can lead to confusion about what value means.

Essentially, value alignment can be tricky because it requires individuals to see eye-to-eye on something that is inherently subjective and complex.

Some key indicators that can encourage an innovation mindset in a value-driven organization:

1. A willingness to take calculated risks and learn from failures.
2. A culture of experimentation and continuous improvement.
3. A focus on customer and market insights to drive innovation.
4. A collaborative and cross-functional approach to problem-solving.
5. An emphasis on data and metrics to measure the success of innovative efforts.
6. A tolerance for ambiguity and a comfortable level of uncertainty.

These indicators create an environment where employees feel empowered to try new things and think creatively, which is essential for driving innovation.

Have good mastering insights!