"Creating shareholder value" became the mantra of leadership. Managers developed a rich set of tools to determine which parts of the business to add or subtract from the value of shares. Unfortunately, a simple application of value-based analysis is not enough to add shareholder value, and these funds are focused on the financial management and the fact that top managers do, while creating value results from the actions of individuals and groups across the company. Comprehensive value-based management (VBM) system must engage, motivate and reward people across the organization that create shareholder value. The system proposed here identifies five stages of development: based on cost analysis, management commitment and expansion goals; EBM training and open book management, employee empowerment and purpose-oriented training and exchange of value. VBM system continues the dialogue between top managers about where the site objectives should be oriented to the future and the involvement of all employees in the determination of the best means to achieve these goals. No less important is the constant desire to learn in VBM and the challenges that arise from this. VBM can not create a strategic vision for the company. But when it is focused on the creation and economic value and improve customer value, and is an integral part of the culture, the firm maximizes its future prospects. "Hide
by Stanley F. Slater and Eric M. Olson Source: Business Horizons 5 pages. Publication Date: September 15, 1996. Prod. #: BH011-PDF-ENG
Related Case Solutions & Analyses:
Jiamei Dental: Private Health Care in China
Question of Principles
Steve & Barrys: To Save or Not To Save
Business Valuation and the Cost of Capital
Hyflux Limited and Water Sustainability – Treading Blue Oceans
Endeavor: Creating a Global Movement for High-Impact Entrepreneurship
What Makes a Virtual Organization Work
Economic Reform in the Czech Republic: Velvet Revolution or Velvet Blanket
Kmart Union in Greensboro Fights for a Contract (A): Early Days – Exhilarating and Frustrating
Soccer Balls Made for Children by Children? (A): Child Labor in Pakistan
