Search results

Value-based management and the balanced scorecard are two of the most distinguished management concepts of the past decades. The main criticism levelled at value-based management is that it is rarely applied in business practice. By contrast, the balanced scorecard is mainly criticized for its insufficient integration into corporate strategy. The two concepts are occasionally described as competing business philosophies in management theory. This chapter offers an integrative view of value-based management and the balanced scorecard. The resulting ‘value-based scorecard’ incorporates the value-based business philosophy while creating a link between the scorecard and the ‘value–added’ corporate strategy. This minimizes a multitude of other critical aspects of both concepts. In light of this, it is recommended that both management theory and business practice further interpret or use the value-based scorecard presented in this study as a tool for value-based management.

Value‐based management focuses the efforts of individuals and managers on the creation of value. Starts with an analysis of the literature on general management and materials management and then extends that analysis to the concept of the value system. Identifies particular management variables which are key to efforts in creating value, e.g. organization structure and hierarchy, centralization, information systems, external relationships, job responsibilities and formalization, performance measurement system, and education and training. Groups these into two broad areas: organization design; and human resource management practices. Collectively these variables form the framework for value‐based management. Describes the nature of these variables in both a traditional, function‐based organization and the more contemporary value‐based organization. Applies the value‐based framework to procurement, identifying those actions needed by managers in the transition of the efforts of procurement individuals towards the creation of value.

Presents some of the main results from a comprehensive survey conducted in 2001 into leadership and management in Danish libraries. The survey focused on leadership roles, perception of future challenges, perception of educational needs and the employment of different leadership tools. The main theme for the paper is an analysis of the data in relation to new public management and value‐based management. The paper starts with a theoretical framework that emphasises the powers that create a certain sort of cross‐pressure. The broad concepts of new public management and value‐based management are outlined. The paper analyses the leaders’ knowledge of leadership tools, classified according to their place in either new public management or value‐based management. The paper also analyses the perception of future leadership roles. It was found that library leaders tend to perceive future roles as being greatly oriented towards people and towards values and see themselves as a kind of catalyst for change.

The purpose of this paper is to present a model for values‐based service brands grounded in values‐based service management. In undertaking this task, the paper addresses two research questions: “What is the role of values in creating customer value and corporate identity?” and “How can values and corporate identity be communicated to customers and thus contribute to customer‐perceived service value?”.

Based on five narratives from a value‐driven company, IKEA, the paper proposes a model of values‐based service brands in action. The model is based on interpretations of how IKEA manages and communicates values in practising values‐based service management.

The study distinguishes four types of “values” in the example of IKEA: economic, social, environmental, and communication‐based. These are incorporated into the model.

This is the first study of the role of values‐based service brands in creating value in use for customers.

The goal of this paper is to develop a model which may be used to demonstrate costs and benefits of risk management investments in the context of value-based management.

This paper answers the question of how to quantify changes in company value caused by risk management measures on a theoretical basis. First, a review of empirical studies allowing assertions about the cost and utility of risk management investments is presented. The results of these studies point to a nonlinear shape of the curve and form a basis for the development of a seemingly plausible cost/utility correlation.

In this paper, a model will be developed which can be used to demonstrate costs and benefits of risk management investments in the context of value-based management. It is assumed that at first, risk management expenditures without measurable monetary utility will have to be made. Furthermore, it is assumed to increase more than proportionally, then less than proportionally, until further investments in risk management activities yield only minimal increases in utility and cannot improve company value any further.

By inserting the yet-to-be-determined actual cost/benefit relationship for a company or industry sector into the EVA equation, it is possible to display the effects of risk management measures on the company value. This procedure is principally combinable with the analysis of other value-based control parameters, that is, the Discounted Cash Flow concept or the Cash Value Added methodology.

Risk management is increasingly gaining scientific and public interest, especially since the global financial crisis. Scientists and practical users espouse the benefits of risk management systems in this context. However, the extent to which investments in risk management systems can improve the value of a company remains still unclear.

We could determine that at first risk management expenditures will not result in a monetarily measurable benefit. The remaining slope of the curve is derived as increasing more than proportionally at first, then less than proportionally, until further investments into risk management activities yield almost no additional increase in benefits. In this paper, three different functions are offered to describe the shape of the curve identified. They differ in regard to their free parameters and hence in their flexibility of application. The higher flexibility of functions #2 and #3 is balanced by the disadvantage of increasing formal complexity, possibly leading to an increased effort for implementation and application.

To harness the relationships developed in this paper for practical use, further research should target the identification and empirical verification of dependencies between the parameters and principal company index values.

The purpose of this paper is to identify the underlying metaphors that hospitals use to establish their organizational mission. Metaphors impact the direction and managerial decision making of organizations, and provide a method to more easily communicate to a variety of stakeholders.

A text analytics process is run to evaluate the mission statements from the largest hospitals by revenue in each of the 50 states of the USA and District of Columbia to identify the types of metaphor-based organizational health management methods.

A cluster analysis is generated to evaluate primary mission-based metaphors, and metatriangulation is used to evaluate output, develop theory and provide practical implications for healthcare management.

Key contributions include a review of healthcare metaphors, an analysis for understanding commonly utilized metaphors, a theory building process for developing a new integrated value-based care management metaphor, and a value-based process is developed for providing healthcare managers an easy to follow and repeatable process for improving organizational communication.

Models of value creation that have been proposed for supporting value-based management are described and analyzed, including the Balanced Scorecard, the Baldrige Quality Award Criteria, the Deming Management Method, the Service-Profit Chain, and the Skandia Intellectual Capital Model. These models are compared, their potential for guiding the identification of value drivers and performance measures for value-based management is assessed, and management issues that must be addressed if such models are to contribute to long-run value creation are explored. These issues include causally linking value drivers to each other and to financial outcomes, the extent to which the models take a dynamic, or whole-system, view of value creation, and whether multiple value drivers should be explicitly weighted and combined to form a “value index.” Finally, the substantial body of research evidence linking intangible value drivers to financial outcomes is reviewed, and some directions for further research are offered.

This paper aims to present the combination of enterprise risk management (ERM) and value-based management as especially suitable methods for companies with a shareholder value imperative. Among its major benefits, these methods make the contribution of risk management for business decisions more effective.

Any possible inconsistencies between ERM, generating value because of imperfect capital markets and the CAPM to calculate cost of capital, which assumes perfect markets, must be avoided. Therefore, it is imperative that valuation methods used are based on risk analysis, and thus do not require perfect capital markets.

Value-based risk management requires the impact of changes in risk on enterprise value to be calculated and the aggregation of opportunities and risks related to planning to calculate total risk (using Monte Carlo simulation) and valuation techniques that reflect the effects changes in risk, on probability of default, cost of capital and enterprise value (and do not assume perfect capital markets). It is recommended that all relevant risks should be quantified and described using adequate probability distributions derived from the best information.

This approach can help to improve the use of risk analysis in decision-making by improving existing risk-management systems.

This extension of ERM is outlined to provide risk-adequate evaluation methods for business decisions, using Monte Carlo simulation and recently developed methods for risk–fair valuation with incomplete replication in combination with the probability of default. It is shown that quantification of all risk using available information should be accepted for the linking of risk analysis and business decisions.

To examine the relationships between Boyatzis et al.’s (2000) philosophical value orientations and Rahim’s (1983 & 1995) conflict management styles through an exploratory research study. The philosophical value orientations are identified as pragmatic, intellectual and human. The conflict management styles are represented as integrating, obliging, dominating, avoiding and compromising.

The author collected a sample of 161 participants gathered from Amazon’s mechanical turk digital labor pool. Participants completed a survey measuring their philosophical value orientations, conflict management styles and provided information on demographic characteristics. Statistical analysis was used to explore the relationship between philosophical value orientations, conflict management style scores and demographic characteristics.

The study demonstrated there were significant associations between the philosophical value orientations and the conflict management styles. Significant associations regarding the philosophical value orientations and conflict management styles were also found across the demographic groups.

Three philosophical value orientations were examined in this study to include pragmatic, intellectual and human; however, there are a multitude of personal and workplace values that could be further studied.

The practical implications of this study show that employees do bring into the company or organization a set of beliefs and value structures that can influence how they respond and relate to their immediate supervisor in challenging or conflicting situations.

The social implications of this study indicate employees’ behavior and reactions to their immediate supervisor are directly manipulated by the value-based system they have developed prior to joining the organization.

No prior research has examined the relationship between Boyatzis et al.’s (2000) philosophical value orientations of pragmatic, intellectual and human and Rahim’s (1983 & 1995) conflict management styles of integrating, obliging, dominating, avoiding and compromising. This study explores how philosophical value orientations are related to the five conflict management styles manifested within the organizational leader-follower dyadic relationship.

The purpose of this article is to synthesize the topics, conceptualizations and measurements of value-based management (VBM) and to suggest a research agenda covering its next evolution as sustainable governance.

The authors conducted a systematic literature review of 80 seminal studies published between 1979 and 2022. The authors synthesized the studies by their conceptualizations of VBM in an inductively developed framework.

The authors find that scholars explore diverse topics related to VBM with a prevailing focus on shareholder primacy. There is a paucity of studies that focus on the integration of shareholder maximization and stakeholder management practices. The authors explain which studies will form a promising foundation for advanced research on sustainable governance that will reach beyond current VBM research.

The authors' research agenda addresses new future topics on conflicting goals within and between shareholder groups, offers specific suggestions for using new research methods and untapped data sources for VBM and paves the way to substantially extend the boundaries of the firm in VBM research to include stakeholders, strategic alignment and new sustainability measures.