Cash Flow Risk Management Under The Perspective Of Enterprises Value Chain

Guidance of the state council in regard to accelerating the development of producer services for upgrading industrial structure adjustment which issued by the state council pointed out that the development should be driven by the demands of industry transformation and upgrading. The government document is aimed at leading enterprise to break the situation of "big as well as complete" and "small as well as complete" in order to extend to the high-end of value chain. It suggests that the central pays attention to the transformation and upgrading of the value chain. It is the most important problem that how to promote the transformation and upgrading of the value chain and manage the value chain effectively. Though the enterprise has a lot of value chain and supply chain, it takes up more money and has a potential risk on places that do not crate value. Thus, cash flow risk management becomes the breach of the value chain management that ensures the better development of enterprises.The goal of enterprises value chain management is to keep enterprises sustainable development and maximize value-added. Cash flow is the carrier of enterprise value creation and damage so that the process of enterprise value creation cannot leave the inflows and outflows of cash flow. On the other hand, cash flow risk is most likely to be gathered in the value chain activities. Therefore, under the perspective of enterprises value chain, how to identify, evaluate and control risk in order to achieve value chain management goals is the most important problem.This article selects Gree electric appliances as case analysis object which is the leading enterprise in the home appliance industry. First we discuss the goals and contents of risk management of cash flow under the perspective of value chain and we believe that security and value creation are the common goals of the enterprise value chain management and cash flow risk management. Then we introduce the identification, evaluation and control process of Gree. We investigate the characteristics and factors of cash flow risk combined with the enterprise internal and external value chain activities. We build the control mechanism of cash flow risk from the content of value chain management. We build the evaluation index system of cash flow risk from the goal of value chain management-At last, we put forward the recommendations that the effective management of cash flow risk can significantly improve the value chain management based on the case.