Who uses VCA?
Initially used by the strategic management teams of organizations and consultancy companies, VCA has much broader application in today’s business world. In particular, many of the other departments of the organizations, such as IT, HR and Finance are more intensively involved in strategic management of modern businesses. Today’s organizations can’t thrive with passive departments doing a routine tasks year by year. Instead, proactive engagement across departments is required in order to create engaged and agile organizations that can cope with fast pace of the business world. Organizations are continuously threatened by digital disruptions and new entrants who are able to utilize technology more effectively and are ready to take over the market leadership.
Organizations’ Engagement in Value Creation
Majority of today’s innovative companies rely on highly capable and talented human capital, and is highly dependent on variety of IT solutions that change how organizations function. Much of the traditional tasks is being automated, and there is an increased pressure on the management of the organizations to better understand the department’s strategic position and collaborate with other departments on value creation. As a result, today’s engaged managers seek value chain analysis tools that can assist them to understand the value creation processes and optimize the value chains of the organization.
Tax Professionals and Boards
In international tax planning and transfer pricing, Value Chain Analysis has become a burning topic for discussion. Recently, a business world has seen an increasing trend across the globe, to hunt multinationals for tax avoidance practices that include misalignment of tax reports and actual economic activity. Companies will need to adapt to the rules outlined in the publication of the final report on BEPS Action Plan 13 and to the specific requirements of some of the governments, e.g. China, which informed that their tax systems will require multinationals to provide information regarding their global value chains. Today’s tax managers, strategy managers and boards of multinational enterprises will need to work together on analyzing their value chains and strategically positioning their international operations.