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Why Leaders Are Still So Hesitant to Invest in New Business Models

Harvard Business Review

More troubling, our own research shows that even when business leaders are proactive resource allocators, they are still hesitant to invest in new business models. Consider the dramatic shift in the types of assets that create market value. How much is changing? It is easy to understand why this is the case.

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A Blueprint for Digital Companies’ Financial Reporting

Harvard Business Review

On June 25, 2018, Facebook lost market capitalization of more than $100 billion in just two hours of trading after it announced its quarterly performance, despite exceeding analysts’ earnings forecasts. The level and trend of a company’s top-line metric is an advance indicator of the success of its business model.

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Why We Need to Update Financial Reporting for the Digital Era

Harvard Business Review

The market caps of just four companies, Apple, Alphabet, Amazon, and Microsoft, now exceed $3 trillion. Their combined assets of $944 billion are an order of magnitude lower than the combined assets of $7,700 billion of the largest 3,177 companies in 1986, when the aggregate market capitalization reached $3 trillion for the first time.

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How B2B Software Vendors Can Help Their Customers Benchmark

Harvard Business Review

We’ve already seen that it’s possible to use external data to evaluate firms on what business models they are employing, and what those business models mean for their valuations. Active investors such as hedge funds seek to outperform the market and index providers.

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GDP Is a Wildly Flawed Measure for the Digital Age

Harvard Business Review

Gross Domestic Product (GDP), our core measure of prosperity, was developed during the industrial age. physical capital), rather than today’s growth drivers of developing and creating human, intellectual, and network capital. It struggles to account for today’s intangible assets—services, insights, and networks.

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