Study On Management Of Cash Flow Based On Value Chain

Since 1985 the American scholar Michael Porter proposed the theory of value chain, its management thoughts develops and deepening unceasingly along with the development of society, economy and technology. The theory of value chain brings an effective management method and analysis tool for the enterprise to construct its core competitive advantages. The thoughts of value chain give a development platform and opportunity for each direction of enterprise management. As the core theory of modern finance, Management of cash flow is also influenced by the thoughts of value chain. The value chain builds a good management and technical foundation for the management of cash flow. So this article takes the strategic relations of the two as the foundation, and tries to extend the content and technology of the traditional management of cash flow.Based on the analysis of the management characteristic of value chain, this article constructs the management framework of the management of cash flow based on the value chain including a basic theory and an application theory. In the basic theory this article gives a new explanation and extent of the concept, the goal, the principle, the supposition and the environment of the traditional management of the cash flow. The application theory system of the management of cash flow includes the plan before happening, the control in the happening matter, and the afterwards evaluation. The plan of cash flow divides the total goal of the management of cash flow into several sub targets according to different value links, establishes the cash flow budget based on sale budget and the work budget, and makes the control system of cash flow to enhance the execution of the management. The control of cash flow is the core of the application theory system. The control is a crossing control of different value link and the quantity, the procedure, the direction, and the speed of cash flow in order to achieve the total goal of management of cash flow. The evaluation of cash flow is an examination of the performance of management of cash flow. In the article a three dimensional and three levels appraisal system is established. Taking A Corporation as the algorithm demonstration, the analysis method of hierarchy process and unification are used to show how to calculate the final grade of the evaluation. Wecan then get the final conclusion of the evaluation and to feedback.The value chain management provides a new research angle for cash flow management. Along with the development of the value chain theory and the promoted application in the enterprise, the theory and content of management of cash flow will certainly be consummated unceasingly, in order to push the enterprise to achieve its management goal of value added maximization.