A value based approach to management

Purpose – The paper aims to present a three‐step approach that enables companies to define and quantify what customers value, systematically deploy their resources to deliver greater value than the competition, and capture a greater share of the value delivered to customers. Design/methodology/approach – Each of the three the three steps in the value creation cycle is examined, and the tools and approaches that leading companies use to maximize shareholder wealth are outlined. Findings – A customer‐value based approach to management can help companies instill a fact‐based decision‐making process in the enterprise. This promotes faster growth through differentiated customer investment. It ensures that the highest return initiatives are prioritized. Enterprises using this disciplined three‐step approach will be well positioned to better understand value potential, creating value, delivering value, and managing their market position to maximize the value they capture. Originality/value – Mastering the value cycle enables enterprises to win in both the customer markets and the financial markets. In short, it leads them to long‐term profitable growth.