Implementation of value-based management system in a petrochemical company
Abstract
The main objective of this study was to determine the extent to which a petrochemical company embraces and implements value based management (VBM) and the overall understanding in all levels of management. Value based management (VBM) was investigated by means of a literature study and theory was analysed through literature and previous research to understand how VBM, together with strategy alignment and implementation can be achieved. Value based management metrics (value drivers) as important metrics in value based management were examined and some studies on the success and failures from past research findings were considered to better understand the implementation of VBM. The company Sasol was chosen in order to understand the petrochemical industry in relation to the stated objective. Previous research on VBM was analysed and compared with Sasol's current situation. From there, Sasol's VBM systems and its importance and factors of success and failures were studied and analysed. For the purpose of the literature review a standardised questionnaire was developed
and followed with an empirical study. Once approval was granted for this research, the
questionnaire was distributed in Sasol Secunda. The research targeted management, middle management and specialised professionals. The completed questionnaire was tested for reliability and validity before it was statistically analysed. Specific constructs were developed during the literature review, which, together with the respondents' basic demographic analysis, helped to explain VBM. After a detailed analysis, the respondents' demographic information and the effects of
all the significant and medium measured constructs (factors) were documented. The
I understanding of value based variables was analysed. In general, Sasol was found to
have an enhanced understanding of value based management. Practical
recommendations to improve systems were suggested and set out in the dissertation.
Suggestions for future research on the topic were also suggested.