Research On EVA Value Management Of Small-medium Enterprises

EVA (economic value added) means the economic added value which is capital benefits of deducting cost of capital. It began as a measure. Until 1982, the Coast Schouten proposes EVA as management model based on enterprise value, so EVA value management began as a scientific management tool which its effectiveness has been confirmed by large state-owned enterprises. In china, many applications obtained good results, such as Tsingtao, Shanghai steel, and TCL and so on, but the majority of SMEs in the use of discourse and practice that related to the basic case lack. Therefore, in view of EVA value management practice and its success at home and abroad as a scientific management idea, I believe that EVA value management should be referenced to the management of SMEs which implement management of Chinese SMEs based on the scientific value of EVA system and value-based management EVA widely used in small and medium enterprises.The paper focus on whether the SMEs in China can apply EVA management system and how the scientific management has effective application. Firstly, the paper introduces background, significance, status,contents and methods of the research; secondly, the paper expounds the basic content of EVA, EVA value management system and implementation steps; thirdly, from value measure, management decision-making, incentives and business philosophy of the four aspects analysis the management status of small and medium enterprises, and then use empirical analysis to prove the feasibility of using the availability of small and medium enterprises with the value of management EVA; lastly, the paper discuss that approach of specific application of EVA management and purpose of achieving the effective application.Through research, the article concluded that, EVA value management in my application is feasible for SMEs. The paper selects the 2008 earlier data from 50 companies of the Shenzhen SME board excluding ST, PT shares as samples. Standing on perspective of measure business value, the paper takes the incremental information content method to verify whether the value of index is superior to EVA traditional values measure and to the added value of the enterprise market, the explanatory power. The results show that, EVA has a different index for the different traditions of incremental information content of the introduction of the EVA index. Evaluation of business performance measurement is based on enterprise value, and business management decision-making, incentives and corporate concept is carried around evaluation of performance management, so the use of EVA value management in small and medium enterprises has empirical viability.The effective application of EVA value management for SMEs can analysis from four aspects which the cores of EVA value management system are value measurement, management decision-makings, incentives and business ideas. First of all, the value measured on the establishment of EVA and the Balanced Scorecard,the paper measures the value of building EVA center to make an accurate measurement in the term of the diagnostic report; secondly, followed by the management decision-making, it sets EVA growth target for EVA value growth to make a sound investment strategy and budget plan; thirdly, the paper establishes the evaluation system based on EVA and incentive bonus program form the incentive mechanism; finally, the paper sets up new EVA values of the company to build a corporate culture based on EVA from the philosophy system. SMEs will be use the EVA management and explore the value of measurement, decision-making of management, incentives and business ideas system to realize a new direction of SME value creation.