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How Incentives for Long-Term Management Backfire

Harvard Business Review

As earnings goals became harder to hit with internal growth, the company used most of its money for share buybacks to achieve its three-year earnings-per-share goals. Facing headwinds to growth, executives delayed R&D and capital investments to hit three-year free-cash-flow goals.

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Why I'm Glad I Got Fired

Harvard Business Review

Then I'd spend the day putting together a fix plan for fixing an issue with a product shipment or the General Motors account. Words like "productivity," "efficiency," and "innovation" are defined by goal posts of our own creation: number of units shipped, revenue and profit, EPS and shareholder return.

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4 Ways CEOs Can Conquer Short-Termism

Harvard Business Review

” The blueprint included the company’s purpose, vision, values, and strategic goals, and fits on a single page. Once in place, it both generates commitment of employees and customers and puts the short term and the quarter in context as the immediate building blocks to longer-term goals.

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The 6 Ways Business Leaders Talk About Sustainability

Harvard Business Review

Crucially, he concludes that our unconscious mental frames “shape the goals we seek, the plans we make, the way we act, and what counts as a good or bad outcome of our actions.” , has shown how the way we frame such challenges shapes our reasoning and priorities much more than most of us recognize.

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What Would Happen if the U.S. Stopped Requiring Quarterly Earnings Reports?

Harvard Business Review

The crux of the issue is how to allow companies to balance the long-term goal of making productive investments without getting bogged down by short-term quarterly pressures. Those discussions need to become more common, regardless of whether companies report quarterly or twice a year.

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