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The effects of the implementation of value-based management

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  • Valentin Beck

    (Leeds Metropolitan University, UK)

Abstract

Many managers are caught in a dilemma: between a desire to maximize the value of their companies and the demands of "stakeholder theory" to take into account the interests of all the stakeholders in a firm. The way out of the conflict lies in a new way of measuring value. The purpose of this paper is to explore how value-based management is perceived, implemented, and utilized in leading automotive corporations in Germany, and to examine factors that influence the decision to utilize it. The data was gained by using in-depth interviews with financial managers of German automotive corporation to study their opinions of and experiences with value-based management systems and metrics. The findings of the empirical study and primary research shows the problems of value-based management implementation in failing to achieve the right balance between all actors of agency conflict.

Suggested Citation

  • Valentin Beck, 2014. "The effects of the implementation of value-based management," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 7(2), pages 153-165, September.
    • Handle: RePEc:tei:journl:v:7:y:2014:i:2:p:153-165
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    References listed on IDEAS

    as
    1. Harley E. Ryan & Emery A. Trahan, 2007. "Corporate Financial Control Mechanisms and Firm Performance: The Case of Value-Based Management Systems," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 34(1-2), pages 111-138.
    2. Harley E. Ryan & Emery A. Trahan, 2007. "Corporate Financial Control Mechanisms and Firm Performance: The Case of Value‐Based Management Systems," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 34(1‐2), pages 111-138, January.
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    More about this item

    Keywords

    value-based management; shareholder-value; performance measurement; technique;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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