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BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX

Yıl 2016, Cilt: 8 Sayı: 1, 131 - 144, 01.06.2016

Öz

The primary objective of most companies in today’s business world is to maximise shareholders’ wealth. Value-based management (VBM) is a management approach that maximises long-term shareholder value using various metrics to determine if wealth was created (or destroyed). Small and medium enterprises (SMEs) are viewed as a means to achieving a dynamic and flourishing private sector as well as to ensure development that is more equitable. This then raises the following questions: can value-based management principles be applied in SMEs to create shareholder wealth; are SMEs able to create value; and, how does SMEs compare when benchmarked against each other? For this study companies listed on the AltX board of the Johannesburg Stock Exchange from 2007 to 2012 was used. Three VBM metrics was used to determine if valued was created or destroyed based on financial performance. Data Envelopment Analysis (DEA), which is a non-parametric linear programming technique, was used as the benchmarking tool. The results indicates that a very limited number of companies were deemed efficient in creating value. It was also established that the financial crisis of 2008 and 2009 had a significant negative impact on the AltX companies

Kaynakça

  • Ameels, A., Bruggeman, W. & Scheipers, G. 2002. Value-based management control process to create value through integration: a literature review. http://www.valuebasedmanagement.net/articles_ameels_valuebased_full.pdf
  • Date of access: 21 Oct. 2016.
  • Avkiran, N.K. 1999. An application reference for data envelopment analysis in branch banking: helping the novice researcher. International journal of bank marketing, 17(5):206-220.
  • Beneke, J.D. 2014. Value-based management for small and medium enterprises in South Africa. Potchefstroom: NWU. (Thesis – PhD) 184 p. (Unpublished)
  • Bowlin, W.F. 1999. An analysis of the financial performance of defence business segments using data envelopment analysis. Journal of accounting & public policy, 18(4/5):287-310.
  • Brigham, E.F. & Ehrhardt, M.C. 2011. Financial management: theory and practice. 13th ed. Mason, Oh.: Thomson. 1152 p.
  • Cook, W.D. & Seiford, L.M. 2009. Data envelopment analysis (DEA) – thirty years on. European journal of operational research; 192(1):1-17, Jan.
  • Feroz, E.H., Kim, S. & Raab, R.L. 2003. Financial statement analysis: a data envelopment analysis approach. Journal of the operational research society, (1):48-58, Jan.
  • Fiegenbaum, A. & Karnani, A. 1991. Output flexibility – a competitive advantage for small firms. Strategic management journal, 12(2):101-114, Feb.
  • Halkos, G.E., & Salamouris, D.S. 2004. Efficiency measurement of the Greek commercial banks with the use of financial ratios: a data envelopment analysis approach. Management accounting research, 15(2):201-224, Jun.
  • Hall, J.H. 2002. Dissecting EVA: the value drivers determining the shareholder value of industrial companies. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=304196 Date of access: 22 Oct. 2016.
  • INET BFA. 2014. www.inetbfa.com Date of access: 14 Nov. 2015.
  • JSE Limited. 2013. Guide to calculation methods for the FTSE/JSE Africa index series. https://www.jse.co.za/content/JSEIndexClassificationandCodesItems/Calculation
  • %20Guide.pdf Date of access: 12 Nov. 2015.
  • Kamalaveni, D. & Kalaiselvi, S. 2010. Market value added: a study in the select
  • Indian software companies. International journal of research in commerce and management, 1(4):227-244, Aug. Koller, T. 1994. What is value-based management? McKinsey quarterly, 3:87
  • Kramer, J.K. & Pushner, G. 1997. An empirical analysis of economic value added as a proxy of market value added. Financial practice & education, 41-49, Spring/Summer.
  • Lloyd, W.J. & Davis, L. E. 2007. Building long-term value. Journal of accountancy, 204(5):56-62, Nov.
  • Longenecker, J.G., McKinney, J.A. & Moore, C.W. 1989. Ethics in small business. Journal of small business management, 27(1):27-31, Jan.
  • Malhotra, D. K. & Malhotra, R. 2008. Analyzing financial statements using data envelopment analysis. Commercial lending review, 23(5):25-31, Sep.
  • Martin, J.D. & Petty, J.W. 2001. Value based management: the corporate response to the shareholder revolution. Baylor business review, 19(1):2-3, Spring/Summer.
  • Megginson, W.L., Smart, S.B. & Graham, J.R. 2010. Financial management. rd ed. Mason, Oh: South-Western. 966 p.
  • Mohanty, P. 2006. Modified TVA-based performance evaluation. IIMB management review, 18(3):265-273, Sep.
  • Pätäri, E., Leivo, T. & Honkapuro, S. 2012. Enhancement of equity portfolio performance using data envelopment analysis. European journal of operational research; 220(3):786-797, Aug.
  • Pelham, A.M. & Wilson, D.T. 1996. A longitudinal study of the impact of market structure, firm structure, strategy, and market orientation culture on dimensions of small-firm performance. Journal of the academy of marketing science, 24(1):27-43, Winter.
  • Ryan, Jr, H.E. & Trahan, E.A. 2007. Corporate financial control mechanisms and firm performance: the case of value-based management systems. Journal of business finance & accounting, 34(1) & (2):111-138, Jan/Mar.
  • Ryan, Jr, H.E. & Trahan, E.A. 1999. The utilisation of value-based management: an empirical analysis. Financial practice and education, 9(1):46-58, Spring/Summer.
  • Scholtz, H. & Smith, A. 2015. Factors influencing corporate governance disclosure of companies listed on the Alternative Exchange (AltX) in South
  • Africa. South African Journal of Accounting Research; 29(1):29-50, Jan. Shanmuga, P.S. 2009. The application of value-based management: an empirical analysis of Indian auto ancillary industry. http://www.thefreelibrary.com/The application of value-based management: an empirical analysis on...-a0214101906
  • Date of access: 21 Oct. 2016.
  • Silva Portela, M.C.A., Thanassoulis, E. & Simpson, G. 2004. Negative data in
  • DEA: a directional distance approach applied to bank branches. Journal of the operational research society, 55(10):1111-1121, Oct.
  • Slater, S.F. 2001. Marker orientation at the beginning of a new millennium.
  • Managing service quality, 11(4):230-233. Spinelli, S. & Adams, R.J. 2012. New venture creation: entrepreneurship for the st century. 9th ed. New York : McGraw-Hill. 700 p.
  • Stern, E. 2011. China adopts EVA: an essential step in the great leap forward*.
  • Journal of applied corporate finance, 23(1):57-62, Winter. Theunissen, M. & Oberholzer, M. 2013. An application of data envelopment analysis to benchmark CEO remuneration: a South African study. Journal of applied business research, 29(5):1509-1522, Sep-Oct.
  • Tortoriello, R. 2009. Quantitatively speaking. Equities, 58(1):10, Jan.
  • Veléz-Pareja, I. 2001. Value creation and its measurement: a critical look at
  • EVA. http://papers.ssrn.com/sol3/Delivery.cfm/99050617.pdf?abstractid=163466
  • &mirid=1 Date of access: 08 Nov. 2014.
  • Wang, Y. & Poutziouris, P. 2010. Leadership styles, management systems and growth: empirical evidence from UK owner-managed SMEs. Journal of enterprising culture, 18(3):331-354, Sep.
  • Xuefeng, T, Tiantian, Z, & Rensel, A. 2014. An analysis of the discrepancies between eva and net profit: a study with reference to gem listed companies. IUP journal of accounting research & audit practices, 13(2):20-26.
  • Zhu, J. 2009. Quantitative models for performance evaluation and benchmarking: data envelopment analysis with spreadsheets. 2nd ed. New York, NY: Springer. 327 p.
Yıl 2016, Cilt: 8 Sayı: 1, 131 - 144, 01.06.2016

Öz

Kaynakça

  • Ameels, A., Bruggeman, W. & Scheipers, G. 2002. Value-based management control process to create value through integration: a literature review. http://www.valuebasedmanagement.net/articles_ameels_valuebased_full.pdf
  • Date of access: 21 Oct. 2016.
  • Avkiran, N.K. 1999. An application reference for data envelopment analysis in branch banking: helping the novice researcher. International journal of bank marketing, 17(5):206-220.
  • Beneke, J.D. 2014. Value-based management for small and medium enterprises in South Africa. Potchefstroom: NWU. (Thesis – PhD) 184 p. (Unpublished)
  • Bowlin, W.F. 1999. An analysis of the financial performance of defence business segments using data envelopment analysis. Journal of accounting & public policy, 18(4/5):287-310.
  • Brigham, E.F. & Ehrhardt, M.C. 2011. Financial management: theory and practice. 13th ed. Mason, Oh.: Thomson. 1152 p.
  • Cook, W.D. & Seiford, L.M. 2009. Data envelopment analysis (DEA) – thirty years on. European journal of operational research; 192(1):1-17, Jan.
  • Feroz, E.H., Kim, S. & Raab, R.L. 2003. Financial statement analysis: a data envelopment analysis approach. Journal of the operational research society, (1):48-58, Jan.
  • Fiegenbaum, A. & Karnani, A. 1991. Output flexibility – a competitive advantage for small firms. Strategic management journal, 12(2):101-114, Feb.
  • Halkos, G.E., & Salamouris, D.S. 2004. Efficiency measurement of the Greek commercial banks with the use of financial ratios: a data envelopment analysis approach. Management accounting research, 15(2):201-224, Jun.
  • Hall, J.H. 2002. Dissecting EVA: the value drivers determining the shareholder value of industrial companies. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=304196 Date of access: 22 Oct. 2016.
  • INET BFA. 2014. www.inetbfa.com Date of access: 14 Nov. 2015.
  • JSE Limited. 2013. Guide to calculation methods for the FTSE/JSE Africa index series. https://www.jse.co.za/content/JSEIndexClassificationandCodesItems/Calculation
  • %20Guide.pdf Date of access: 12 Nov. 2015.
  • Kamalaveni, D. & Kalaiselvi, S. 2010. Market value added: a study in the select
  • Indian software companies. International journal of research in commerce and management, 1(4):227-244, Aug. Koller, T. 1994. What is value-based management? McKinsey quarterly, 3:87
  • Kramer, J.K. & Pushner, G. 1997. An empirical analysis of economic value added as a proxy of market value added. Financial practice & education, 41-49, Spring/Summer.
  • Lloyd, W.J. & Davis, L. E. 2007. Building long-term value. Journal of accountancy, 204(5):56-62, Nov.
  • Longenecker, J.G., McKinney, J.A. & Moore, C.W. 1989. Ethics in small business. Journal of small business management, 27(1):27-31, Jan.
  • Malhotra, D. K. & Malhotra, R. 2008. Analyzing financial statements using data envelopment analysis. Commercial lending review, 23(5):25-31, Sep.
  • Martin, J.D. & Petty, J.W. 2001. Value based management: the corporate response to the shareholder revolution. Baylor business review, 19(1):2-3, Spring/Summer.
  • Megginson, W.L., Smart, S.B. & Graham, J.R. 2010. Financial management. rd ed. Mason, Oh: South-Western. 966 p.
  • Mohanty, P. 2006. Modified TVA-based performance evaluation. IIMB management review, 18(3):265-273, Sep.
  • Pätäri, E., Leivo, T. & Honkapuro, S. 2012. Enhancement of equity portfolio performance using data envelopment analysis. European journal of operational research; 220(3):786-797, Aug.
  • Pelham, A.M. & Wilson, D.T. 1996. A longitudinal study of the impact of market structure, firm structure, strategy, and market orientation culture on dimensions of small-firm performance. Journal of the academy of marketing science, 24(1):27-43, Winter.
  • Ryan, Jr, H.E. & Trahan, E.A. 2007. Corporate financial control mechanisms and firm performance: the case of value-based management systems. Journal of business finance & accounting, 34(1) & (2):111-138, Jan/Mar.
  • Ryan, Jr, H.E. & Trahan, E.A. 1999. The utilisation of value-based management: an empirical analysis. Financial practice and education, 9(1):46-58, Spring/Summer.
  • Scholtz, H. & Smith, A. 2015. Factors influencing corporate governance disclosure of companies listed on the Alternative Exchange (AltX) in South
  • Africa. South African Journal of Accounting Research; 29(1):29-50, Jan. Shanmuga, P.S. 2009. The application of value-based management: an empirical analysis of Indian auto ancillary industry. http://www.thefreelibrary.com/The application of value-based management: an empirical analysis on...-a0214101906
  • Date of access: 21 Oct. 2016.
  • Silva Portela, M.C.A., Thanassoulis, E. & Simpson, G. 2004. Negative data in
  • DEA: a directional distance approach applied to bank branches. Journal of the operational research society, 55(10):1111-1121, Oct.
  • Slater, S.F. 2001. Marker orientation at the beginning of a new millennium.
  • Managing service quality, 11(4):230-233. Spinelli, S. & Adams, R.J. 2012. New venture creation: entrepreneurship for the st century. 9th ed. New York : McGraw-Hill. 700 p.
  • Stern, E. 2011. China adopts EVA: an essential step in the great leap forward*.
  • Journal of applied corporate finance, 23(1):57-62, Winter. Theunissen, M. & Oberholzer, M. 2013. An application of data envelopment analysis to benchmark CEO remuneration: a South African study. Journal of applied business research, 29(5):1509-1522, Sep-Oct.
  • Tortoriello, R. 2009. Quantitatively speaking. Equities, 58(1):10, Jan.
  • Veléz-Pareja, I. 2001. Value creation and its measurement: a critical look at
  • EVA. http://papers.ssrn.com/sol3/Delivery.cfm/99050617.pdf?abstractid=163466
  • &mirid=1 Date of access: 08 Nov. 2014.
  • Wang, Y. & Poutziouris, P. 2010. Leadership styles, management systems and growth: empirical evidence from UK owner-managed SMEs. Journal of enterprising culture, 18(3):331-354, Sep.
  • Xuefeng, T, Tiantian, Z, & Rensel, A. 2014. An analysis of the discrepancies between eva and net profit: a study with reference to gem listed companies. IUP journal of accounting research & audit practices, 13(2):20-26.
  • Zhu, J. 2009. Quantitative models for performance evaluation and benchmarking: data envelopment analysis with spreadsheets. 2nd ed. New York, NY: Springer. 327 p.
Toplam 43 adet kaynakça vardır.

Ayrıntılar

Diğer ID JA24BT37SD
Bölüm Makaleler
Yazarlar

John Beneke Bu kişi benim

Yayımlanma Tarihi 1 Haziran 2016
Yayımlandığı Sayı Yıl 2016 Cilt: 8 Sayı: 1

Kaynak Göster

APA Beneke, J. (2016). BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX. International Journal of Economics and Finance Studies, 8(1), 131-144.
AMA Beneke J. BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX. IJEFS. Haziran 2016;8(1):131-144.
Chicago Beneke, John. “BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX”. International Journal of Economics and Finance Studies 8, sy. 1 (Haziran 2016): 131-44.
EndNote Beneke J (01 Haziran 2016) BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX. International Journal of Economics and Finance Studies 8 1 131–144.
IEEE J. Beneke, “BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX”, IJEFS, c. 8, sy. 1, ss. 131–144, 2016.
ISNAD Beneke, John. “BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX”. International Journal of Economics and Finance Studies 8/1 (Haziran 2016), 131-144.
JAMA Beneke J. BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX. IJEFS. 2016;8:131–144.
MLA Beneke, John. “BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX”. International Journal of Economics and Finance Studies, c. 8, sy. 1, 2016, ss. 131-44.
Vancouver Beneke J. BENCHMARKING VALUE CREATION OF COMPANIES LISTED ON THE JSE’S ALTX. IJEFS. 2016;8(1):131-44.