Four figures

Every element that bears load is given its capacity, its utilisation, the value it carries and its cost. For a system, the capacity is what it can deliver and the utilisation is what is drawn from it; the value is the revenue and margin of the capabilities and commitments that depend on it; the cost is what it takes to sustain, in licences, hosting, people and maintenance. For a dataset the same four hold, with the value carried by the reports, invoices and models that read it. For a model in production, the capacity is the decisions it can make at a stated quality and the value is the revenue and margin of the decisions delegated to it.

Propagation

Value is propagated rather than assigned. The specification adapts the input-output method used in economics to trace how the output of one sector depends on every other, so that a reference table three transformations upstream of a pricing product carries a share of that product’s revenue, and a provider beneath four of the enterprise’s models carries the sum of their shares. A mart nobody reads carries nothing, and is visible as such with its running cost.

Where the records do not reach

Where the enterprise’s own financial data does not reach an element, industry priors fill the gap and the figure is marked as an estimate with a range. In the inferred state, before any record is opened, every value is an estimate of this kind; in the corrected state, the enterprise’s management accounts, budgets and contracts replace them element by element.

What it is not

The figures are decision figures inside the model. They are not a valuation for the balance sheet, for tax or for a transaction price, and the firm does not present them as one.

Status

Valuation is the capability with no complete implementation in the firm’s register, and it is the one that distinguishes a valued estate from a catalogue. It is on the critical path of the first paid engagement and is stated as such.