What is the Value Creation Wheel (VCW)?
The VCW is a decision making process to find an excellent solution for a challenge.
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The VCW structures the decision-making process to find an excellent solution for a challenge.
Decision-makers must be motivated to address the challenge, considering a wide range of ideas and applying multiple filters to evaluate them. By using these filters in a sequential and iterative process, they can narrow down the options and ultimately select the most effective solution(s).
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During a meal, a person might consider various drinks to satisfy their thirst (e.g., water, tea, coffee, juices, sodas, soft drinks, and alcoholic beverages), and use different criteria to select the final option (e.g., cost, health considerations, nutritional content, purpose or occasion, time of day, and cultural or social norms).
The person making the final decision should narrow down the choices by analyzing the options and applying their selected filters (e.g., caffeine sensitivity or low nutritional content). If the initial option (e.g., herbal tea) doesn’t meet specific criteria (e.g., budget constraints), they continue applying new filters until they find the best solution (e.g., tap water). This process of refining ideas with filters is both sequential and cyclical.
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The Value Creation Wheel (VCW) is a framework for co-creation, innovation, decision-making, and problem-solving.
The VCW is designed to identify solutions to problems involving Key Decision Makers in different phases and stakeholders to generate solutions and filters to select the best ideas.
It addresses open-ended questions starting with 'What', 'Which', 'How', 'Who', 'Why', and 'When'.
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The VCW defines value creation as the benefits received by Key Decision Makers (KDMs) and their stakeholders resulting from VCW solutions, minus the required resources (e.g., 3Ms- Manpower, Money, Minutes) to develop those solutions. Hence, the value created by the VCW implies allocating resources to receive something of higher worth.
VCW Sprint
The Five Stages of the VCW
Key Decision Makers (KDMs) present a diagnostic and define the available resources (3Ms: Manpower, Minute & Money). They present the challenge/problem and establish the expected Key Performance Indicators (KPIs).
1. Define Challenge
2. Increase Ideas & Criteria
Many people (e.g., VCW team, stakeholders, and KDMs) generate numerous ideas and criteria to solve the challenge. In this phase, ideas and criteria should not be evaluated.
There are no good/bad ideas and criteria.
3. Assess
The KDMs select the best ideas and best criteria to solve the challenge. They establish a ranking for the criteria that are compulsory. Weights are then given to the optional criteria. Stakeholders might be invited for the discussion.
4. Narrow Down to Create Value
The selected ideas go through the ranked filters and through the weighted optional filters until finding the final solutions.
They will then be conceptualized and/or prototyped. Stakeholders and KDMs might be involved in this analysis and discussion.
5. Act & Control
The final solutions need to be operationalized by KDMs and stakeholders. KDMs validate the available resources (3Ms) and implement and monitor the execution of the final solutions. Stakeholders might be engaged in this phase.
Levels of Complexity
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VCW FUNNEL
2 hours
“Workshops to break the ice and initially address the challenge”
Watch a video of the VCW Funnel in use here.
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VCW SPRINT
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VCW JOURNEY
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VCW METHOD
3 days–5 months
“Courses, Workshops, Consulting, Complex projects”
Watch a video of the VCW Method in use here.
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VCW META FRAMEWORK
6 months - 4 years
“EC Horizon projets, Innovation Ecosystems, Consulting, Workshops”
Watch a video of the VCW Meta Framework in use here.
Download the PDF version here.
Image of Professor Luis Filipe Lages with President of Portugal, Professor Marcelo Rebelo de Sousa holding the VCW - Value Creation Wheel book.
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VCW Creator
Luís Filipe Lages
Luis Filipe Lages is Full Professor and Director of the VCW Lab at Nova School of Business and Economics. He was a Visiting Scholar is several schools across the globe including LBS, MIT Engineering School, MIT Sloan School of Management, and Stanford Graduate School of Business. He is a Professor of Innovation, Value Creation, Marketing Strategy, International Marketing, and Managerial Decision Making. Among others, he was recipient of the “American Marketing Association Global Marketing SIG Research Excellence Award”. His work has been presented to corporate, business, governmental and university audiences across the globe and appeared in the main international business media such as Time & Wall Street Journal.
VCW Lab
@ Nova SBE
We help others make better decisions
We contribute for better innovation, decision making and problem solving, while constantly improving the VCW method. We develop and test a wide range of VCW’s products and services, always supported by research & development (R&D), testing, go-to-market, comercialisation, and sustainable sales.
VCW Lab @ Nova SBE
Nova School of Business and Economics
R. da Holanda 1, 2775-405 Carcavelos, Cascais, Lisbon, Portugal
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