Value Reversion

So I'm just finishing up a course on cost and value management in projects, and I got to thinking about value creation. More specifically, what types of value do projects create for an organization? My initial thought was that myriad types of value can be created - increased productivity, reduced loss, enhanced brand awareness, improved quality, increased sales, etc. The outcome of a project designed to achieve any of the preceding objectives is an increase in value for the firm.

However, we all know that goals and objectives have to be measurable to be meaningful. And pretty much anything that can be measured can be quantified. Improving quality may be the project objective, but quality has to be defined in real terms, not just as an abstract concept. For example, if quality means less waste, then the performance indicators for your project are the amounts of waste produced. As waste is reduced, value is created.

So if you can quantify the value, won't it always be possible to convert it back into monetary terms? If you're measuring the amount of waste, it's good business to know what that waste is costing you - I mean, that's really the business case for undertaking the project in the first place. The same holds true for any project objective. Viewed in these terms, value always reverts to money. And if you can't revert value back to dollars, I'd venture to say that you either aren't measuring performance correctly, or that the project really isn't creating any value.