Value Maps Valuation Tools That Unlock Business Wealth

by Miller, Warren D.

• ISBN13: 9780470437568
• ISBN10: 0470437561
• Edition: 1st
• Format: Hardcover
• Copyright: 2010-05-24
• Publisher: Wiley

Summary

Value Maps: Valuation Tools that Unlock Business Wealth shows valuation experts how to guide client companies through a rigorous self-assessment using the SPARC (Strategy, People, Architecture, Routines, Culture) Framework. SPARC reveals to analysts the causal relationships among a firm's external opportunities and threats and its internal strengths and weaknesses. The resulting road map offers a unique, step-by-step guide toward increasing the value of a business. This invaluable guide provides valuation analysts and business appraisers with a powerful new perspective on valuation and their businesses.

Author Biography

WARREN D. MILLER, CFA, ASA, CPA, is a cofounder of Beckmill Research LLC, a firm that specializes in valuations, mergers and acquisitions, strategy, litigation support, exit planning, and statistics-driven research. He has taught CPAs and other professionals in thirty states, Puerto Rico, and Canada. His work has been published in Harvard Business Review, Business Valuation Review, CFA Magazine, Strategic Finance, CPA Expert, Value Examiner, and American Fly Fisher. He and his wife, Beckmill cofounder Dorothy Beckert, live in Virginia's breathtaking Shenandoah Valley.

Table of Contents

Preface.

Acknowledgements.

About the Web Site.

List of Acronyms.

Part I CORNERSTONES.

Chapter I Why a New Approach Is Needed.

Valuation as Craft.

The State of Our Craft.

Cause and Effect: What and Why.

Multidisciplinary Tools for Analyzing Value Creation.

Parameters of Valuation.

What We Know about Risk.

Components of Risk.

A Framework for Unsystematic Risk.

Unlocking Business Wealth.

Summary.

Additional Reading.

Chapter 2 Tools from Strategic Management.

History.

Perspective.

Valuation Tools.

Strategic Intent.

Generic Competitive Strategies.

Resources.

Competitive Analysis.

Distinctive versus Sustained Competitive Advantage.

VRIO.

Customer Satisfaction Surveys.

Diversification.

Unlocking Business Wealth.

Summary.

Additional Reading.

Chapter 3 Tools from Industrial Organization.

Perspective.

Tenets.

Tools.

Unlocking Business Wealth.

Summary.

Additional Reading.

Chapter 4 Tools from Organization Theory.

Perspective.

Tenets.

Tools.

Unlocking Business Wealth.

Summary.

Additional Reading.

Chapter 5 Tools from Evolutionary Economics.

Perspective.

Tenets.

Tools.

Unlocking Business Wealth.

Summary.

Additional Reading.

Chapter 6 Tools from Austrian Economics.

Perspective.

Tenets.

Tools.

Unlocking Business Wealth.

Summary.

Recommended Reading.

Part II POURING THE FOUNDATION.

Chapter 7 The Straight Scoop on Value Drivers.

Definition.

Value Drivers versus Balanced Scorecards.

Why Value Drivers Matter.

The Regenerative Power of Capitalism.

Assessing Durability.

Summary.

Additional Reading.

Chapter 8 The "OT"in SWOT Analysis: The Macroenvironment.

Defining the Domain.

Unit of Analysis.

Trilevel Unsystematic Risk Framework.

History and Background.

Why Does the Macroenvironment Matter?

The Forces.

Summary.

Additional Reading.

Chapter 9 The "OT"in SWOT Analysis: The Domain.

The Roots of Domain Analysis.

Oligopolies Large and Small.

Price Competition in an Oligopoly.

Published Industry Risk Premiums.

The Domain.

Summary.

Additional Reading.

Appendix 9A: Competitive Analysis and Estimating Market Share.

Chapter 10 Getting to "Why": Analyses, Composites, and On-Site Interviews.

Financial Ratios.

A Key Metric.

Finding Sector-Specific Metrics.

The Analysis.

How to Construct a Composite.

Prepping for the On-Site Interviews.

Conducting the On-Site Interviews.

Summary.

Chapter 11 The "SW"in SWOT Analysis: The Company and SPARC.

Cause-and-Effect Relationships.

Value Drivers and Value Destroyers.

Assessing Durability of Advantage.

Back to VRIO.

Summary.

Appendix 11A: Bringing It All Together: Quantifying Unsystematic Risk.

Chapter 12 SPARC Archetypes among Small and Medium-Sized Enterprises.

Exploiter and Extender.

Explorer and Experimenter.

Equivocator.

Summary.

Part III TALES FROM THE FIRING LINE.

Chapter 13 Construction and Manufacturing.

Construction.

Specialty Publishing I.

Specialty Publishing II.

Specialty Manufacturing.

Packaging.

Chapter 14 Business to Business.

Safety Equipment/Supplies.

Industrial Supply.

Construction Materials.

Antique Building Materials Reclamation.

Chapter 15 Transportation.

Transportation Collection Services.

LTL Trucking.

Freight Forwarding.

Chapter 16 Specialty Retailing.

Jewelry I.

Jewelry II.

Building Materials.

Pharmacy.

Chapter 17 Services.

Outplacement Services.

Executive Search.

Private Equity.

Investment Banking.

Dental Lab.

Quick-Lube Services.

Part IV PRACTICE MANAGEMENT.

Chapter 18 The Engagement Process.

When Can an Engagement Include a Value Map?

Finding Good Clients.

Avoiding Problem Clients.

Marketing and Selling the Work.

The "Shake-'n'-Howdy"Visit.

Pricing the Engagement.

Engagement Letter 1.

Highlights of Engagement Letter 1.

Managing Expectations.

Engagement Letter 2.

Summary.

Chapter 19 Working with Clients.

A Few Words about Family Systems.

Processes.

How Not to Do It.

How (Else) Not to Do It.

Start at the Beginning.

Think like a Buyer.

Planning the Engagement.

As the Process Unfolds.

Winding Up the Value-Mapping Process.

Summary.

Additional Reading.

Chapter 20 IFRS, IVSC, and Value Maps.

The Valuation Process Outside the United States.

The Cost of Capital Outside the United States.

Gathering Data Outside the United States.

Summary.

Chapter 21 Epilogue: The Future for Value-Mapping Services.

The Future for Valuation Services.

Marketing Matters.

That Special Cadre Dedicated to Delivering Value to Clients.

Closing Words.

Bibliography.

Index.