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Evaluating Investments for Services: A Value Chain Analysis Framework

Journal of Service Science (JSS), Vol. 1 No. 2, pp. 47-56, 2008

10 Pages Posted: 6 Dec 2011  

Narcyz Roztocki

State University of New York at New Paltz - School of Business

Heinz Roland Weistroffer

Virginia Commonwealth University (VCU) - School of Business

Date Written: December 1, 2008

Abstract

This paper presents a framework based on value chain analysis to evaluate investments for services. The rationale for this approach is that to properly evaluate the benefits of any services investments, the value and cost interactions resulting from different business processes or activities need to be considered. To achieve reliable cost estimations, the framework employs a costing system, which integrates activity-based costing with the economic value added performance measure. The proposed framework is illustrated using a hypothetical case of an information technology investment in a car repair shop.

Keywords: ABC, activity based costing, business proces, cost estimation, costing system, economic value added, performance measure, service sector, services investments, value chain, value chain analysis

JEL Classification: G00, L00, M40, M41

Suggested Citation

Roztocki, Narcyz and Weistroffer, Heinz Roland, Evaluating Investments for Services: A Value Chain Analysis Framework (December 1, 2008). Journal of Service Science (JSS), Vol. 1 No. 2, pp. 47-56, 2008. Available at SSRN: https://ssrn.com/abstract=1968615

Narcyz Roztocki (Contact Author)

State University of New York at New Paltz - School of Business ( email )

New Paltz, NY 12561
United States
(845)257-2935 (Phone)
(845)257-2947 (Fax)

HOME PAGE: http://www2.newpaltz.edu/~roztockn/

Heinz Roland Weistroffer

Virginia Commonwealth University (VCU) - School of Business ( email )

Richmond, VA 23284-4000
United States

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