EconPapers    
Economics at your fingertips  
 

Optimising a value-based performance indicator in mid-term sales and operations planning

G J Hahn and H Kuhn ()
Additional contact information
G J Hahn: Katholische Universität Eichstätt-Ingolstadt
H Kuhn: Katholische Universität Eichstätt-Ingolstadt

Journal of the Operational Research Society, 2011, vol. 62, issue 3, 515-525

Abstract: Abstract Economic Value Added (EVA®) and corresponding value driver trees are prevalent frameworks of value-based management to measure and analyse shareholder value creation. However, they are explanatory models from an operations research perspective and do not provide decision support for performance optimisation. In this paper, we develop a comprehensive value-based decision framework for mid-term sales and operations planning (S&OP) in the supply chain implementing EVA as the objective function. The pivotal element of our framework is a decision-oriented extension of EVA-based value driver trees bridging the gap to the decision variables of S&OP as the operational performance levers. We utilise a numerical example to highlight the significant improvement potential due to the value-based optimisation approach. Working capital management emerges as the major mid- to short-term value driver in the supply chain.

Keywords: value-based management; supply chain optimisation; sales and operations planning (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://link.springer.com/10.1057/jors.2010.96 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:jorsoc:v:62:y:2011:i:3:d:10.1057_jors.2010.96

Ordering information: This journal article can be ordered from
http://www.springer. ... search/journal/41274

DOI: 10.1057/jors.2010.96

Access Statistics for this article

Journal of the Operational Research Society is currently edited by Tom Archibald and Jonathan Crook

More articles in Journal of the Operational Research Society from Palgrave Macmillan, The OR Society
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2025-03-19
Handle: RePEc:pal:jorsoc:v:62:y:2011:i:3:d:10.1057_jors.2010.96