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Document Type

State of the Art

Abstract

There is no doubt that at least since the
1990s process orientation has evolved
into one of the central paradigms of organizational
design. Since then, all process
management subtasks have matured.
Process management decisions,
however, lack economic foundation. They
are usually based on qualitative or technical
criteria or on plausibility considerations
that do not necessarily comply
with typical objectives in a market
economy. Consequently, design alternatives
are hardly comparable and an integrated
valuation of a company’s assets
is impossible. The status quo is astonishing
for several reasons: First, process
management decisions usually imply
investment projects with different
risk/return positions and capital tie-up.
Second, the need for designing processes
according to their contribution
to corporate objectives has been explicated
repeatedly. Third, the paradigm
of value-based management is an accepted
theoretical framework from economic
research that enables to consistently
valuate the risk/return effects of
decisions across functional areas, hierarchy
levels, and asset classes. This suggests
the hypothesis that process management
in general as well as the goal
orientation of process management decisions
in particular have evolved almost
independently of value-based management.
In the paper at hand, this hypothesis
is confirmed based on a sample
of process management publications.
We therefore explicate the research gap
as regards value orientation in process
management. In order to bridge the gap
between value-based management and
process-oriented organizational design,
we transfer economically well-founded
objective functions to process management
decisions.

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