Limitations of the Value Creation Wheel Essay

Paper Type:  Essay
Pages:  3
Wordcount:  553 Words
Date:  2022-06-22

Value Creation Wheel is a problem-solving framework utilized by individuals and organizations' key decisionmakers to establish consensual and customized solutions for the current challenges and solutions. The method has achieved significant success over the period of its application. However, it also has some limitations that challenge its use in the business world (Lages, Fonseca & Paulino, 2018). First, the Value creation wheel framework is complex. In general, it is made up of two complementary frameworks namely DIANA and TIAGO. DIANA is more of a conceptual approach, which consists of established and predetermined processes. TIAGO, on the other hand, is more flexible and can be altered to accommodate the challenge presented. The latter is executed in five phases namely tap, induce, analyze, ground, and operate. Therefore, each phase is dependent on the successful execution of its predecessor. For instance, the second phase involves the generation of numerous ideas through brainstorming process, which involves the consideration of the internal and external stakeholders (Lages, 2016). Additionally, this phase is further divided into two to incorporate the generation of solutions and filters. Therefore, this presents a complex and a tiring process before one comes up with the needed solution.

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Moreover, the execution of the framework is time-consuming. Apart from being complex, this approach consumes a lot of time for one to cover all its phases and processes exhaustively. For instance, in the case of Deimos expansion, the tool involved the collection of data from all the processes undertaken from the project inception up to the VCW application data, which was to be analyzed to generate the bigger picture of the problem facing the farm (BABSON., 2017). It also involved other stages such as brainstorming, analysis, capture value, and operationalization, which required and extended the period for its execution.

Additionally, the framework is expensive to undertake. This is due to the undertaking of processes such as the interaction with the internal and external stakeholders, the analysis of each solution identified, and the implementation and trial of the viable options. These processes are costly and can only be used to solve organizational challenges that are profitable enough to finance the framework.

The process is disposed to errors and does not guarantee the establishment of a perfect solution to the problem identified. According to Lages (2016), the structure is established in a circular approach, which allows the repetition of the process until the final solution is established. This means that the approach does not result in an accurate conclusion in its first attempt. Therefore, this can be considered as a significant drawback to the method considering its complex nature.

The approach can also be said to only favour the endowed and established organizations. The execution of TIAGO phase requires the use of extensive funds since it incorporates the collection of data, which involves an extensive employment of efforts and resources (Lages, Fonseca & Paulino, 2018). Additionally, other phases such as the VCF process are also costly ventures, which cannot be funded by small organizations.


Lages, L. F. (2016). VCW-Value Creation Wheel: Innovation, technology, business, and society. Journal of Business Research, 69(11), 4849-4855.

Lages, L. F., Fonseca, V., & Paulino, M. (2018). The VCW-Value Creation Wheel: A Framework for Market Selection and Global Growth. In Advances in Global Marketing (pp. 253-279). Springer, Cham.

BABSON. (2017). Deimos: Expanding to a New Market Using the Value Creation Wheel. Entrepreneurial Leader collection.

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