Innovation-valuation-tool construction company
Visser & Smit Hanab (VSH) is an operating company within the construction firm VolkerWessels. The activities of VSH involve development, construction and maintenance of networks, connections and plants in the water and energy sectors. The company has 1700 employees and is primarily active in northwest Europe and in Hungary.
The unit Commerce and Technology Development is active within VSH and focuses on developing new markets. Instead of the traditional commercial approach in the sector (constructors submitting quotations based on detailed specifications) the unit creates demand for the construction units of the company. It therefore actively manages a portfolio of initiatives.
To increase the return-on-innovation a method and tool was needed to evaluate and manage the financial and strategic returns of initiatives. An innovation valuation methodology and (software) tool was developed. The tool provides:
- the value of the innovation portfolio (based on Risk Adjusted Net Present Value methodology)
- the financial and strategic values of individual projects
- drivers for continued value development through innovation
- an implemented system for structured portfolio management and value optimization
For each project an estimation is made of the chance of success and the expected financial and strategic contribution to the overall company results.
The resulting overview helps the unit to make better decisions on the progress of initiatives and also helps the discussion about how the initiatives can be improved. Additionally, the overview gives the company a clear view of the units contribution, through their initiatives, to the future results of VSH.