Total Value of Ownership
Total value of ownership focuses on maximizing operational efficiency, beyond direct and indirect instrument costs.
What are the benefits of Total value of Ownership?
– It definitely saves a company a lot of time
– and saves spaces as well
– while the workflow is optimized
– and the Key Performance Indicators (KPIs) are highly improved
Total value of ownership (TVO) and total cost of ownership (TCO) are commonly used in industries to evaluate operational performance of a company. TVO helps to uncover the true value of any chosen asset, helping it to stay viable in the phase of rising costs budget cuts and pressures to deliver more value to the asset’s overall ecosystem.
TVO considers the additional benefits of an investment or process and not just cost alone. Furthermore, TVO is about determining which decision will drive the greatest value, both from a monetary perspective as well as from the view of the desired outcome.
TVO is one of the method used to help customers improve their ability to provide greater value to the customers and community.
The primary purpose of every business is to maximize profit. However, to do this without creating value is a step in the wrong direction. Value creation is an essential base to support a profitable and lasting business.
Value creation is the increase in value from transforming raw inputs to the final output. You can think of value creation as the extra benefit that is derived from the transformation of raw inputs to final products. As you transform the products, the customer’s willingness to pay for the goods increase. The greater the customer’s willingness to pay, the greater the value that has been created.
Value creation for customers helps to sell products and services, creating value for employees results in higher efficiency and creating value for shareholders translates into increase in stock price, future guarantee of investment capital.