Concept and Overview
Value-Based Management (VBM) concept is centered on the fundamental goal of ensuring the long-term survival and growth of a business. It moves away from traditional concepts of prioritizing scale or immediate profit. Instead, VBM utilizes metrics such as EVA (Economic Value Added) and RAROC (Risk-Adjusted Return on Capital) etc. to measure the value of products, customers, business lines, subsidiaries, employees, and channels. By balancing risk and return, VBM focuses on steadily improving capital returns and developing comprehensive strategies, market goals, management frameworks, performance evaluation systems, and corporate culture. This approach ensures that short-term profits are achievable, long-term profits are predictable, and capital is preserved and enhanced, thereby promoting the continuous growth of enterprise value.
Architecture and main functions
VBM is a next-generation enterprise management software based on value-based management principles and advanced digital technologies, covering a wide range of applications, including accounting, financial management, human resources management, investment management, production and manufacturing, procurement and supply chain, profitability management, and risk management etc. As an integrated enterprise management platform, VBM encompasses business transactions, accounting, analysis, and decision-making. It aids businesses by recognizing, collecting, storing, calculating, and mining internal and external data. This enables intelligent business management throughout the entire process, from learning and analysis to early warning, forecasting, and decision-making. VBM serves as the decision-making hub for precise marketing, intelligent manufacturing, digital procurement, product innovation, cost control, internal compliance, and risk warning.
