What is Value Based Management - Definition

What is Value Based Management? Definition.

It is useful to understand that Value Based Management includes all three of the following:

1. Creating Value (ways to actually increase or generate maximum future value ≈ strategy).

2. Managing for Value (governance, change management, organizational culture, communication, leadership), and

3. Measuring Value (valuation).

Definition 2: Value Based Management aims to provide consistency of: 

• the corporate mission (business philosophy), 

• the corporate strategy (courses of action to achieve corporate mission and purpose), 

• corporate governance (who determines the corporate mission and regulates the activities of the corporation), 

• the corporate culture, 

• corporate communication, 

• organization of the corporation, 

• decision processes and systems, 

• performance management processes and systems, and

• reward processes and systems,

with the corporate purpose and values a corporation wants to achieve (normally: maximizing shareholder value).

Note 1: Value Based Management is dependent on the corporate purpose and the corporate values.

Note 2: The corporate purpose can either be economic (Shareholder Value) or can also aim at other constituents directly (Stakeholder Value).

Compare: Clarkson Principles  |  History of Value Based Management  |  Benefits of Value Based Management  |  Intrinsic Stakeholder Commitment  |  Strategic Stakeholder Management  |  Seven Surprises  |  Strategic Intent

About us | Advertise | Privacy | Support us | Terms of Service

©2023 Value Based Management.net - All names ^tm by their owners