article thumbnail

Will You Be Writing Off Your Investment in Egypt?

Harvard Business Review

In both places, we know the instability will worsen macroeconomic performance in the short term. Foreign subsidiaries can expect local sales to fall and distribution channels to come to a halt, with depressing consequences for the bottom line. But in both places, the upheaval may usher in a new era of democracy.

NPV 12
article thumbnail

Case Study: Should a Hotelier Invest in a New Kind of Online Travel Agency?

Harvard Business Review

Although this wasn’t out of the ordinary for European hoteliers, Ervaring needed to reduce its cost per booking to improve its bottom line. When a user closed out of a hotel website without booking a room, a HotelShield ad would pop up under the window, offering alternative prices and locations within the same or a partner brand.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Stop Focusing on Profitability and Go for Growth

Harvard Business Review

So, in real terms, debt financing is essentially free. Next time you're deciding about a big investment, NPV can help you make a more informed decision. Equity cash flows, in turn, are a function of a company’s long-term return on equity (ROE), growth, and the value of shareholders’ equity on its books.

ROE 13
article thumbnail

Reflecting on David Garvin’s Imprint on Management

Harvard Business Review

David Garvin, who died earlier this month, was by all accounts one of the great Harvard Business School teachers, lighting up the classroom and the minds of his students over the past 38 years. But the article aimed higher, arguing that when corporate leaders invest with short-term results in mind, they put long-term performance at risk.