When evaluating if an idea is good or not, don’t just limit your evaluation to today’s dollars. Great leaders need to consider all four types of value. These include:
- Current dollars (profits or revenues we can access immediately)
- Future dollars (profits or revenues that will occur in the long-term)
- New capability (additional skills, knowledge, experience that can enhance strategy)
- Brand impact (beneficial market recognition)
VW (along with all the major established car manufacturers) is spending billions of dollars on building battery factories and R&D to support the shift to EV. Of course, VW wants to be able to sell cars that their customers want in the future (or will be mandated to have by governments), but the decision to move into battery tech also gives them new capability to improve their own battery know-how and possibly create new advantages like fast-charging.
VW’s move to EV batteries also helps improve a reputation that is still stinging from the issues related to falsifying emissions data on diesel cars sold in the US.
Good ideas do not just “pencil out” with today’s dollars or even tomorrow’s dollars. Take a look at ideas to improve your business with a holistic approach that also takes into account new capacity that could be valuable in the future along with the positive reputation that attaches to organizations that have the guts to try new things.