The phrase refers to the principle that there is one and ONLY one value maximizing solution for a given company and set of circumstances.

Hundreds of companies can (and do) boast that they “create value”. But ONLY that company which implements the Single Best Value Solution can be claim to be maximizing value.

This is not merely some rhetorical distinction. The great majority of self-described “value-creating” corporations are in reality value destroyers based on the admittedly tough criteria that anything less than full, potential value is value reduction.

And then management of the company who settle for merely creating some value wonder what hit them when a predator´s unsolicited bid threatens to end the firms independence and their careers. Apparently, the fact that value was missed was no secret.

“Value creation” can refer to an improvement of just a penny. Think of maximum value as being a dollar. 1

Miss the full value prize, and management might as well try to fake it on hollow financial bluff-spin alone.

Up to the end of its era as an independent financial institution, one time international high flyer NatWest Bank proclaimed that its stellar management team had created significant shareholder value.

But the unwillingness and/or inability of those same leaders to secure Single Best Value Solutions opened the door for predators. In the end, NatWest was acquired by Royal Bank of Scotland after being ‘put in play´ by London´s financiers.

Implications for corporate value planning are equally stark. Squander the limited funds earmarked for corporate value creation on mousy metrics and pedantic value processes is like buying the paint for a house but forgetting to build the structure itself.

Fail to provide priority emphasis and funding for identification and then pursuit of the few essential ACTIONS for maximizing can end up like NatWest: managers without a home, shareholders without full value.

Notes:

1

Beginning of The Value Mandate: Maximizing Shareholder Value Across the Corporation by Clark & Neill (New York, Amacom, 2002, 3) “Your corporation is underperforming by fifty percent. in value terms.”
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