Jerry N. Luftman and C. Timothy Koeller
- Published in print:
- 2003
- Published Online:
- January 2005
- ISBN:
- 9780195159530
- eISBN:
- 9780199834983
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195159535.003.0005
- Subject:
- Economics and Finance, Financial Economics
The value management approach provides organizations seeking an IT-leveraged path to competitiveness with a model to help identify improvements in customer-focused processes. It begins by ...
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The value management approach provides organizations seeking an IT-leveraged path to competitiveness with a model to help identify improvements in customer-focused processes. It begins by understanding business objectives and value. Next, it reviews the business process changes necessary to obtain the business value. Finally, the information technologies necessary to change the business process that will bring the business value are defined.Less
The value management approach provides organizations seeking an IT-leveraged path to competitiveness with a model to help identify improvements in customer-focused processes. It begins by understanding business objectives and value. Next, it reviews the business process changes necessary to obtain the business value. Finally, the information technologies necessary to change the business process that will bring the business value are defined.
Patrick Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- book
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.001.0001
- Subject:
- Economics and Finance, Financial Economics
For decades, the traditional approaches to business valuation (market, asset, and income) have taken center stage in the assessment of the firm. This book presents an expanded valuation toolkit, ...
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For decades, the traditional approaches to business valuation (market, asset, and income) have taken center stage in the assessment of the firm. This book presents an expanded valuation toolkit, consisting of nine well-defined valuation principles hailing from the fields of economics, finance, accounting, taxation, and management. It ultimately argues that the “value functional” approach to business valuation avoids most of the shortcomings of its competitors, and more correctly matches the actual motivations and information held by stakeholders. To remedy the shortcomings of existing theory, the author proposes a new definition of the firm that is consistent with the principle that entrepreneurs maximize value, not profit.Less
For decades, the traditional approaches to business valuation (market, asset, and income) have taken center stage in the assessment of the firm. This book presents an expanded valuation toolkit, consisting of nine well-defined valuation principles hailing from the fields of economics, finance, accounting, taxation, and management. It ultimately argues that the “value functional” approach to business valuation avoids most of the shortcomings of its competitors, and more correctly matches the actual motivations and information held by stakeholders. To remedy the shortcomings of existing theory, the author proposes a new definition of the firm that is consistent with the principle that entrepreneurs maximize value, not profit.
David J. Jeremy
- Published in print:
- 1990
- Published Online:
- October 2011
- ISBN:
- 9780198201212
- eISBN:
- 9780191674839
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198201212.003.0004
- Subject:
- History, British and Irish Modern History, History of Religion
Before the First World War, business Élites were closely tied to the Christian religion as the Victorian culture of these times was intensely religious. The tenets of Christianity are imposed upon ...
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Before the First World War, business Élites were closely tied to the Christian religion as the Victorian culture of these times was intensely religious. The tenets of Christianity are imposed upon infancy and the religious encounters came by various means and in differing degrees of intensity. This chapter discusses the most forceful agencies or religious influences that formed the business values, skills and networks of business Élites of the 1900s to 1960s. The foremost agencies discussed herein are the family, the school and the local church which are believed to have greatly inculcated Christian beliefs in their formative years. These religious influences are carried out and served as their framework and dogma in their business values, business perspective, skills and their social connections.Less
Before the First World War, business Élites were closely tied to the Christian religion as the Victorian culture of these times was intensely religious. The tenets of Christianity are imposed upon infancy and the religious encounters came by various means and in differing degrees of intensity. This chapter discusses the most forceful agencies or religious influences that formed the business values, skills and networks of business Élites of the 1900s to 1960s. The foremost agencies discussed herein are the family, the school and the local church which are believed to have greatly inculcated Christian beliefs in their formative years. These religious influences are carried out and served as their framework and dogma in their business values, business perspective, skills and their social connections.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0013
- Subject:
- Economics and Finance, Financial Economics
This chapter describes the three traditional methods of valuing a business: the market approach, asset approach and income approach. For each, he describes a valuation principle and an underlying ...
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This chapter describes the three traditional methods of valuing a business: the market approach, asset approach and income approach. For each, he describes a valuation principle and an underlying mathematical equation. The author describes the income or “discounted cash flow” approach is a workhorse of practical valuation. He observes the heavy reliance on subjective adjustments in actual use of this approach, which he argues supports the critique of the net present value rule and the weakness of this and other approaches in which subjective judgment, rather than actual use of a method, is the dominant factor. Finally, two of these traditional approaches are used to value three example firms, with the weaknesses in certain methods and the dominance of subjective adjustments made apparent.Less
This chapter describes the three traditional methods of valuing a business: the market approach, asset approach and income approach. For each, he describes a valuation principle and an underlying mathematical equation. The author describes the income or “discounted cash flow” approach is a workhorse of practical valuation. He observes the heavy reliance on subjective adjustments in actual use of this approach, which he argues supports the critique of the net present value rule and the weakness of this and other approaches in which subjective judgment, rather than actual use of a method, is the dominant factor. Finally, two of these traditional approaches are used to value three example firms, with the weaknesses in certain methods and the dominance of subjective adjustments made apparent.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0015
- Subject:
- Economics and Finance, Financial Economics
This chapter presents the theory behind the novel value functional method. This includes the importance of the definition of the firm introduced in this book, which includes separation, replicable ...
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This chapter presents the theory behind the novel value functional method. This includes the importance of the definition of the firm introduced in this book, which includes separation, replicable business practices, and an objective of the firm that is not restricted to profit maximization, the maximization of value, rather than profit, a whirlwind introduction to control theory, and the distinction between the familiar concept of a function and the obscure notion of a functional. The author then presents a functional equation (or Bellman equation) that relates the value of a firm to specific optimization by the manager or entrepreneur. This theory is the basis for the tenth approach to valuation described in this book: the “recursive” or “value functional” approach. The author concludes by proposing conditions for the existence of a solution to the value functional equation for actual firms, basing these in human transversality conditions that he outlines.Less
This chapter presents the theory behind the novel value functional method. This includes the importance of the definition of the firm introduced in this book, which includes separation, replicable business practices, and an objective of the firm that is not restricted to profit maximization, the maximization of value, rather than profit, a whirlwind introduction to control theory, and the distinction between the familiar concept of a function and the obscure notion of a functional. The author then presents a functional equation (or Bellman equation) that relates the value of a firm to specific optimization by the manager or entrepreneur. This theory is the basis for the tenth approach to valuation described in this book: the “recursive” or “value functional” approach. The author concludes by proposing conditions for the existence of a solution to the value functional equation for actual firms, basing these in human transversality conditions that he outlines.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0016
- Subject:
- Economics and Finance, Financial Economics
This chapter demonstrates practical uses of the value functional approach in the estimation of the value of operating businesses. It includes a detailed discussion of state and control variables, a ...
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This chapter demonstrates practical uses of the value functional approach in the estimation of the value of operating businesses. It includes a detailed discussion of state and control variables, a presentation of four different ways to formulate and solve a value functional problem, including dynamic programming (also called “stochastic control”), Markov Decision Problem (“MDP”), Hamilton-Jacobi-Bellman (“HJB”) method, and “by hand.” The author also presents computational designs for these methods, and observations on the practical difficulties of using them. Finally, the author demonstrates the use of this approach on three actual companies. This allows the reader to see the difference in results (and of the necessity for subjective adjustments) among the value functional and other valuation methods described in this book.Less
This chapter demonstrates practical uses of the value functional approach in the estimation of the value of operating businesses. It includes a detailed discussion of state and control variables, a presentation of four different ways to formulate and solve a value functional problem, including dynamic programming (also called “stochastic control”), Markov Decision Problem (“MDP”), Hamilton-Jacobi-Bellman (“HJB”) method, and “by hand.” The author also presents computational designs for these methods, and observations on the practical difficulties of using them. Finally, the author demonstrates the use of this approach on three actual companies. This allows the reader to see the difference in results (and of the necessity for subjective adjustments) among the value functional and other valuation methods described in this book.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0005
- Subject:
- Economics and Finance, Financial Economics
This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the ...
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This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the data on survivorship rates for newly-established businesses in multiple countries. It critically examines the stylized facts about such businesses in the United States. Finally, it provides updated data on the value of privately-held businesses in the U.S., following the methodology of Anderson (2009). Those data suggest that equity in privately held firms form a larger share of household assets than stocks in publicly-traded firms among U.S. households.Less
This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the data on survivorship rates for newly-established businesses in multiple countries. It critically examines the stylized facts about such businesses in the United States. Finally, it provides updated data on the value of privately-held businesses in the U.S., following the methodology of Anderson (2009). Those data suggest that equity in privately held firms form a larger share of household assets than stocks in publicly-traded firms among U.S. households.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0017
- Subject:
- Economics and Finance, Financial Economics
The author argues that start-up firms, distressed firms, and near-bankrupt firms are the exception, not the rule, in the modern economy. This raises the question of whether such firms, which are ...
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The author argues that start-up firms, distressed firms, and near-bankrupt firms are the exception, not the rule, in the modern economy. This raises the question of whether such firms, which are commonly small and financed largely by the entrepreneurs involved, have value. The chapter also discusses the applicability of traditional valuation methods for such firms, compared with the novel value functional or recursive method. The author concludes that, when properly evaluated, start-ups and distressed firms do have value.Less
The author argues that start-up firms, distressed firms, and near-bankrupt firms are the exception, not the rule, in the modern economy. This raises the question of whether such firms, which are commonly small and financed largely by the entrepreneurs involved, have value. The chapter also discusses the applicability of traditional valuation methods for such firms, compared with the novel value functional or recursive method. The author concludes that, when properly evaluated, start-ups and distressed firms do have value.
Steven Heine
- Published in print:
- 2005
- Published Online:
- October 2011
- ISBN:
- 9780195160031
- eISBN:
- 9780199850273
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195160031.003.0002
- Subject:
- Religion, Buddhism
This chapter begins with a discussion of Japanese business and social values. It then describes how Zen combines some of the best elements of two ideal, yet seemingly contradictory, forms of behavior ...
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This chapter begins with a discussion of Japanese business and social values. It then describes how Zen combines some of the best elements of two ideal, yet seemingly contradictory, forms of behavior in medieval Japan—the Warrior and the Hermit—which can be effectively applied to contemporary affairs. This is followed by a discussion of the Unmoving Mind, which is characterized by a firmness and lack of vacillation that derives from confidence and inner strength.Less
This chapter begins with a discussion of Japanese business and social values. It then describes how Zen combines some of the best elements of two ideal, yet seemingly contradictory, forms of behavior in medieval Japan—the Warrior and the Hermit—which can be effectively applied to contemporary affairs. This is followed by a discussion of the Unmoving Mind, which is characterized by a firmness and lack of vacillation that derives from confidence and inner strength.
