Criticism on Value Based Management

Criticism on Value Based Management

🔥NEW Some criticize the principles of value-based management, arguing it fails to take into account other constituencies than stakeholders (locals, customers, employees, environment etc). But in order to create value for shareholders, there should also be a good reputation in 3 areas:
1. The quality of goods and services.
2. Capability to find talented people, hire them and keep them as employees.
3. The community/environment.
Indeed, evidence exist that value for shareholders could exist only if there is value for other constituencies as well. For example, once customers are not pleased, they will buy from competitors. Or, if employees are unsatisfied, they will leave and change their job.
Source: S. D. Young and S. F. O'Byrne, EVA and Value-Based Management: A Practical Guide to Implementation.

		Comments Sort by date Sort by rating Rating
		2 Ottervanger Partner, Netherlands
	Value Creation with Focus and Respect for the 3 P's! Value based management means sustainable long-term value creation. That means creating business valu... Sign up

		2 Pouw Teacher, Netherlands
	At the End It's the Money that Decides! Stakeholders (a shareholder is one of them) are free tot leave, so they stay as long as their person... Sign up

		2 Ranjan Director, India
	Temptations of VBM to Only Consider Short Term and Interests of Shareholders Considering values only in the interest of shareholder is not right, it has to be for all the stakeh... Sign up

		0 Rajesh Sharma Professor, Nepal
	Value Based Management VBM is a consistent technique to stand n the business for the long run by providing quality product,... Sign up