- name
- value-waterfall
- description
- Decompose value creation or destruction through waterfall analysis. Use for understanding value drivers and financial analysis.
Value Waterfall
Metadata
- Name: value-waterfall
- Description: Sources of value creation/destruction analysis
- Triggers: value waterfall, value creation, value bridge, financial decomposition
Instructions
Analyze sources of value creation or destruction for $ARGUMENTS using waterfall methodology.
Framework
The Waterfall Structure
Starting Value
│
├── + Revenue Growth ($10M)
│
├── + Margin Improvement ($5M)
│
├── - Investment Costs ($3M)
│
└── Ending Value
Total Change: +$12MOutput
## Value Waterfall: [Subject]
### Value Bridge
| Component | Impact | Running Total |
|-----------|--------|---------------|
| **Starting Value** | - | $100M |
| Revenue Growth | +$15M | $115M |
| Price Increase | +$5M | $120M |
| Cost Reduction | +$8M | $128M |
| Investment | -$6M | $122M |
| One-time Charges | -$2M | $120M |
| **Ending Value** | - | $120M |
| **Total Change** | **+$20M** | **+20%** |
### Visualization
$130M ┤ ╭──────── │ ╭────╯ $120M ┤ ╭────╯ Ending │ │ Value $110M ┤╭───╯ ││ Running $100M ┤│ Total ││ $ 90M ┤│ └──────────────────────── Start Rev Price Cost Inv Charge End
### Key Drivers
**Value Creators:**
1. Revenue Growth (+$15M) - [Explanation]
2. Cost Reduction (+$8M) - [Explanation]
3. Price Increase (+$5M) - [Explanation]
**Value Destroyers:**
1. Investment (-$6M) - [Explanation]
2. One-time Charges (-$2M) - [Explanation]
### Insights
- **Largest creator**: Revenue growth (75% of positive impact)
- **Largest destroyer**: Investment (30% of negative impact)
- **Net value created**: +$20M (20% improvement)
### Strategic Implications
1. [Implication 1]
2. [Implication 2]Tips
- Start with clear baseline
- Group related items
- Show running totals
- Quantify each component
- Focus on material items