Creating value in firms at different management levels

Abstract

PurposeValue is created for firms’ owners when profits outweigh investments over a given time period. This paper aims to distinguish where, within firms, strategic thinking is required for the purposes of creating value.Design/methodology/approachA novel framework is developed, which explains how six sources of value can be identified and logically related to six practical value management levels.FindingsImportantly, only one source of value, namely, autonomous revenue growth, demands true strategic thinking because it represents an unknown outcome from the strategist’s perspective. This source of value can be tapped into at any decision-making level.Originality/valueThis paper clarifies and emphasises that demonstrating strategic wisdom is possible for anyone within a firm and ultimately, it resolves down to the thinking and decision making that increases the chances of generating higher, earlier and more frequent future incoming cash flows.