Saturday, January 22, 2022


Investment management needs to ensure that they are investing in the right business initiatives and create headroom for innovation and business growth.

There are varying changes and fierce competitions in the business environment nowadays, organizations have limited resources and budgets, but there are plenty of opportunities that they intend to grasp and so many problems that need to be solved. It’s important for the management to set criteria, clarify what investments they should direct more assets to by solving problems with priority, driving business value in terms that business stakeholders understand, generate business cases and look for investments to be justified and governed on the basis of benefit delivery.

Visibility: When people speak about an initiative generating new revenue, visibility into each investment is established to provide ongoing investment health information as well as enable understanding overall portfolio health. It’s also crucial to evaluate the impacts of investment decisions by presenting a "strategic" look to maximize the business's benefit from the investment. In fact, achieving visibility of strategy investment helps the leaders or investors become more future-oriented and discover the path to where they need to go and be persuasive to lead others in the right direction and reach the destination confidently.

Besides presenting benefits, achieving visibility of costs against the visibility of quantifiable benefits as a key strategic initiative today provides a pathway justification of value contribution to the organization's bottom line performance within each revenue stream, to improve transparency and effectiveness. The visibility of asset consumption and the capability to allocate the cost of those assets based on that consumption results in an accurate measurement of contribution to Cost of Sale (COS) that is both traceable and visible.

Profitability: Without customers, an organization cannot survive and without profitability, an organization cannot grow and thrive. Without profitability, the investment cannot reap the benefit. The challenge for investment management is about spending more resources and time on innovation-related activities to reap high profitability. The emerging technology is always the hot investment area, but in the end, it is not about technology, but what technology can do to solve critical problems, deliver strategic differentiation and reach high return on investment.

There are different variables in investment related decision-making. Evaluate each of the variables from the perspective of the original value (the value that was assumed when the investment was prioritized); current value (the value that considers the current scenario with the current costs) projected value (the value considering a conservative scenario according to what we expect in the future). The comparisons help to review investment progress, deviations, and make more effective decisions for improving the overall investment management maturity. The wise investors analyze business models that list all of the sources of value, cost, and risk, and contain formulas to interconnect them; it generates predictions for how much profit the business will make, as well as how to strike the right balance of short term gain and long term perspectives.

We are moving toward the people-centric age with innovation, choice, empathy. People-centric businesses are fluid, flexible, and intelligent in knitting all necessary elements together into great customer experience and drive a seamless paradigm shift. From the outside-in viewpoint, the customer is the focal point to improve business performance by developing personalized products/services to gain customer loyalty. From the inside-out, employees are the key to accelerate business performance, how to motivate them by providing personalized advice or tools to deliver higher than expected business results.

Without customers, an organization cannot survive, without high quality employees, businesses cannot thrive. People are always the most important capital investment in any organization. There are different methods, greater transparency, more engagement and retention initiatives, training, and development at every level. Good investors invest in a good business model; great investors invest in the best of the best people with entrepreneur’s mindset, value adding, and having progressive ideas, etc. When people are filled with inspiration supported by better understanding, they can better adapt to changes and unleash their full potential.

Venture investment is a complex business activity. The investment management needs to ensure that they are investing in the right business initiatives and create headroom for innovation and business growth. It's also important to show the clear business goals of the investment with critical elements such as returns, return timeline, and risk assessment. The logical investment scenario helps to assess whether the business models associated with emerging trends or people-centricity is the right investment to be done in the first place, and ensure the expected return on investment.


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