Value Based Management and Eva Practice by Selected Plantation Companies in Sri Lanka

Value Based Management (VBM) is relatively a modern approach used by organization as a tool of measure the performance over its business activities, which links performance of business, strategy and processes; ultimately it leads to maximize the value of an organization. VBM delivers dynamic, high performance organization results. It builds on the strengths of financially focused tools, such as Economic Value Added (EVA) and its derivatives, by adding the perspectives of customers and other stakeholders who make organizations succeed. The purpose of this study is to identify the extent of Value based management (VBM) methods embrace by the Sri Lankan selected plantation companies and characteristics of those companies too. The study is based on a survey of selected seven plantation companies in Sri Lanka and statistical analysis that follows the probability and tabulation of survey data through structured questionnaire and secondary data to investigate the application of value based management practiced by analysis of qualitative choice. The survey results reveals that most popular VBM method among the selected plantation companies in Sri Lanka, from those listed, is the DCF method. Value-based management is used mostly in the areas of investment decisions (DCF and ROIC are the most common), long-term planning (ROIC is the most common)