5DoBT – The Management Method
13 March 2018
„Managing is not about cutting costs, but creating value.“
Most managers act according to this principle. During the operational implementation, however, questions arise again and again which are difficult to answer:
- Which projects do I decide on within my strategy, market conditions and opportunities?
- How can I measure the value?
- How can I make success measurable?
- How can I control projects if something changes?
In order to answer these questions, different methods have been used for a long time, but they show different shortcomings in answering the complete question and are sometimes very time-consuming and expensive.
In order to fully answer these complex questions without becoming too complicated, MARKTGUT has developed a interconnected method that uses different methods such as ROI or value management and reduces them to the essence.
Value Management serves as an approach to redesign and optimize processes, organizational units, products and services. However, the focus of these projects is primarily on reducing costs. Other criteria that can be used to measure added value transparently and clearly are usually considered less frequently and unstructured. For this reason, MARKTGUT has identified five criteria that correspond to the most important management requirements for structured decision-making and offer a future-oriented perspective.
What is 5DoBT?
The 5 Dimensions of Business Thinking, or 5DoBT for short include not only the above-mentioned fostering of innovation but also the dimensions of increasing sales, efficiency, minimizing risk and increasing the level of innovation.
All dimensions are based on different areas of influence, which are to be understood as levers for optimization and value creation in projects. The 5DoBT can be used for a wide variety of issues and industries, as their definition leaves a lot of room for individual demands. They serve as food for thought and can be extended in any way.
Based on the dimensions and their detailed areas of influence, it is possible to determine the realizable potential of projects. To this end, a value-potential analysis-methodology is applied which helps to identify and evaluate the most important fields of action for optimization measures in order to be able to quickly make well-founded decisions for or against a project.
The 5DoBT methodology
The methodology is based on a framework that includes the definition of the business case under consideration, the identification and calculation of potentials as well as a summary of the results over the course of three years. The framework is used to determine the identified potentials on the basis of key figures and assumptions. Not all potentials are quantitatively measurable, so the methodology also offers the possibility to integrate qualitative potentials. These potentials are then classified according to their degree of influence in order to assess their viability by the project team and to identify and take into account possible risks at an early stage.
The calculated overall potential is subject to a lifetime assessment because the outcomes cannot be equally realized over the first three years. In addition, margineffectiveness of all five dimensions is determined so that a reasonable overall potential for the next three years is ultimately established. The framework also offers the possibility to link each potential to respective fields of action which show the measures that have to be implemented in order to realize the potential.
The methodology is easy to use and therefore usable by everyone. It helps to quantify the economic benefits of projects, even at an early stage, and make them transparent. This transparency is essential when it comes to determining whether the implementation or continuation of a project is economically viable.
In contrast to the ROI calculation, the 5DoBT methodology is better suited in the earlier phases because it is not based exclusively on measured results. Rather, the value-potential analysis is applied regularly to measure and verify the potential over the entire life cycle of the project, so that these potentials can be constantly refocused. Thanks to the well-defined fields of action of each potential, the methodology also offers a transparent controlling element in order to realize an idea in a target-oriented way for a successful project and to realize the identified potentials sustainably.
Thus, this methodology provides a controlling- and management tool in order to manage, verify and document project successes transparently and measurably.
5DoBT in practice
In the last three years, our value-potential analysis 5DoBT has been successfully applied and continuously developed in more than 30 projects within different industries and orientations. Be it for prioritizing IT demands, creating strategic roadmaps or validating project-idea potentials, the methodology is well accepted by our customers and integrated into their own operations sustainably. They use this methodology as a tool for communication within projects, in different areas of the enterprise and for decision-making.
What potential can be realized in your business?
We would be pleased to provide you with detailed and personal information on the 5DoBT value-potential value analysis in your company.
Please contact us.