Harvard Business Review

AUGUST 20, 2018

Activist hedge funds have become capital market and financial media darlings. The Economist famously called them “capitalism’s unlikely heroes” in a cover story, and the FT published an article saying we “should welcome” them. companies for an eight-year period (2005–2013).

Hedge 8

Hedge TSR Company Sample 8

Terry Starbucker

AUGUST 29, 2010

And change it did, because the new CEO had a vision that went beyond product, and costs, and overhead, and costs of capital. Thirteen years later, the stock price is now above $240, and it has a market cap bigger than Microsoft. Jobs, in that speech, declares that “ Marketing is about values&#.

Technology 282

Technology Price Video Cost of Capital 282

Harvard Business Review

OCTOBER 21, 2016

Today’s executives are dealing with a complex and unprecedented brew of social, environmental, market, and technological trends. Yet executives are often reluctant to place sustainability core to their company’s business strategy in the mistaken belief that the costs outweigh the benefits. In 2005, they launched a U.S.

Supply Chain 8

Supply Chain Price Loyalty Efficiency 8

Harvard Business Review

SEPTEMBER 4, 2017

.” There is a virtuous cycle between productivity and people: Higher levels of productivity allow society to reinvest in human capital (most obviously, though not exclusively, via higher wages), and smart investments result in higher labor productivity. Unfortunately, this virtuous cycle appears to be broken. And wages are stagnant.

Human Capital 13

Human Capital Kaizen Agility Energy 13

Harvard Business Review

AUGUST 27, 2015

Companies in the top one-fifth of profitability earn, in aggregate, about 70 times more economic profit (accounting profit less cost of capital) than those in the middle three-fifths combined, according to McKinsey’s database of 3,000 large, publicly listed, nonfinancial U.S. Consider what’s happening among corporations.

ROIC 8

ROIC McKinsey GDP Company 8

Harvard Business Review

MARCH 28, 2016

A study of leading public company CFOs published in the Journal of Accounting and Economics (2005), found that 78% of these CFOs would be willing to make decisions that destroy value in order to achieve their quarterly earnings targets. Outside funds bring with them a pressure to achieve short-term results that trade-off with value creation.

Long-term 8

Long-term Short-term Reputation Incentives 8

Harvard Business Review

DECEMBER 13, 2017

This has been a remarkable year for the markets. Investors punish companies with a short-term orientation by applying higher discount rates to them, which increases the cost of capital for those companies. This means they generate less revenue, profit and market value per dollar of R&D. MirageC/Getty Images.

Short-term 8

Short-term Decentralization Company Trends 8