What is Value Indicator

This chapter is a descriptive and explicative case study about value creation at Siemens in an uncertain and in a certain environment. Siemens has implemented economic value-added-based management since 1998. The empirical data analysis highlights value creation at Siemens at the beginning of the innovation lifecycle, when the environment is uncertain, and at the end of the innovation lifecycle, when contracts are signed, and the environment becomes predictable. Innovation is first placed in open networks, in which start-ups are essential, to which venture capital is allocated using business models. This is the ideation stage of the product lifecycle, when competitive advantage, the essence of value creation in both theory and the Siemens example, is created. Innovation matures, and Siemens closes contracts with customers about existing customer offerings. These contracts are managed as projects and funded with equity and debt. This is the stage when sufficient data exists to plan economic value added, the focus of Siemens' corporate governance.