values

Examples of values in the following topics:

• The Exchange of Value

  • Value can also be expressed as $Value = Benefits - Costs$
  • Value is thus subjective (i.e., a function of consumers' estimation) and relational (i.e., both benefits and cost must be positive values).
  • For an organization to deliver value, it has to improve its value to cost ratio.
  • When an organization delivers high value at high price, the perceived value may be low.
  • When it delivers high value at low price, the perceived value may be high.

• Functions of Money

  • The main functions of money are as a medium of exchange, a unit of account, and a store of value.
  • Gold was popular as a medium of exchange and store of value because it was inert.
  • It must be divisible into smaller units without a loss of value.
  • The value of the money must also remain stable over time.
  • Some have argued that inflation, by reducing the value of money, diminishes its ability to function as a store of value.

• A Brief Definition

  • Promotion – how the producer communicates the value of its products – is one of the market mix elements.
  • Promotion – how the producer communicates the value of its products – is one of the market mix elements.

• Profit and Value

  • Profit is equal to a firm's revenue minus its expenses, while value is the present value of the firm's current and future profits.
  • A) The value of a firm is the sum of its expected profits; B) The value of a firm is the sum of the PV of its current and future profits; or C) The value of a firm is its current profit.
  • In terms of a business, value is the present value of the firm's current and future profits.
  • The value of a firm is linked to profit maximization.
  • Profit is equal to a firm's revenue minus its expenses, while value is the present value of the firm's current and future profits.

• Performance per Share

  • The below ratios describe the value of shares of stock to stockholders, both in terms of dividends and their general ownership value:
  • The P/E ratio is a widely used metric used for measuring the relative value of companies.
  • Market To Book ratio is used to compare a company's current market price to its book value.
  • In the first method, the company's market capitalization can be divided by the company's total book value from its balance sheet (Market Capitalization / Total Book Value).
  • The second method, using per-share values, is to divide the company's current share price by the book value per share, which is its book value divided by the number of outstanding shares (Share Price / Book Value Per Share).

• The marketing model

  • The marketing model is an approach whereby companies create value for their customers.
  • This concept can be understood by applying it in the so called Value Chain Model introduced by Michael Porter.
  • A simple way to understand the creation of value to customers is by examining the following equation:
  • Value is created by increasing benefits to the customers.
  • Now you must understand how value is created for your customers.

• The wasteful practices inherent in businesses

  • ') This means that up to 95% of the activities in most businesses add no customer value at all.
  • Activities classified as ‘non-value' can be split into two categories.
  • The first, necessary, but non-value adding activities, constitutes as much as 35% of most organizational work and is comprised of actions that do not directly contribute to what customers want in a product (e.g. payroll, behind-the-scenes cleaning, the fulfilment of government regulations, and so on).
  • The second category, non-value adding activities, can comprise up to 60% of work activities, yet these activities add no value to customers in any way, shape or form (e.g. production line snags, waiting periods, unnecessary paperwork, end-of-line quality inspections, etc.).

• Values, aesthetics, and time

  • An individual's values arise from his/her moral or religious beliefs and are learned through experiences.
  • For example, in America we place a very high value on material well-being, and are much more likely to purchase status symbols than people in India.
  • Americans spend large amounts of money on soap, deodorant, and mouthwash because of the value placed on personal cleanliness.

• Starting the journey

  • Specify what the customer defines as value.
  • Anything that does not add value from a customer perspective should be reduced or eliminated.
  • Draw up a value map.
  • A value map is much like a process map with one distinct difference: a value map starts from the customer end and makes a clear distinction between value-added activities (transformational activities for which the customer is willing to pay) and non-value-added activities (activities that add cost without adding customer value).
  • As flow is introduced, let customers pull value from the next upstream activity.

• Assets

  • Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset.
  • Simply stated, assets represent ownership of value that can be converted into cash (although cash itself is also considered an asset).
  • The balance sheet of a firm records the monetary value of the assets owned by the firm .
  • Intangible assets are nonphysical resources and rights that have a value to the firm because they give the firm some kind of advantage in the market place.
  • That is, the total value of a firm's assets are always equal to the combined value of its "equity" and "liabilities. " In other words, the accounting equation is the mathematical structure of the balance sheet.