Complimentary Resource – Change Is Constant: PMBOK Guide 5th Edition

Strategy Driven

Anyone contemplating pursuit of their PMP or CAPM certification within the next 12 months needs to know that both the PMP and CAPM examinations will change from dependence on the PMBOK Guide® Fourth Edition to focus on the PMBOK Guide® Fifth Edition on July 31, 2013. Complimentary Resource – Data Quality: A Survival Guide for Marketing. Change Is Constant : PMBOK Guide 5th Edition. by Global Knowledge.

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Still Many Ways to Skin a Capital Cost

Harvard Business Review

When executives evaluate a potential investment, whether it's to build a new plant, enter a new market, or acquire a company, they weigh its cost against the future cash flows they expect will spring from it. knew that firms were making heavy use of the capital asset pricing model (CAPM) to size up growth opportunities, but that the model was only as good as its inputs. Not at all, he said, because it's "no secret that applying the CAPM is as much an art as financial science."

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Why Sit on All that Cash? Firms Uncertain on Cost of Capital

Harvard Business Review

In estimating the cost of equity, nearly nine out of ten organizations use the capital asset pricing model (CAPM), which calculates the cost of equity using a risk-free rate, beta factor, and a market risk premium, each of which introduces significant variability. Book vs. Market Weighting Factors Used for Debt and Equity in Calculation of WACC. . Current market debt/equity ratio. Current book debt/current market equity ratio.

What Private Equity Investors Think They Do for the Companies They Buy

Harvard Business Review

We also know that private equity funds have outperformed public equity markets over the last three decades , even after the fees they charge are accounted for. Furthermore, few PE investors explicitly use the capital asset price model (CAPM) to determine a cost of capital. Another indication that PE investors are skeptical of CAPM-based methods for valuing companies is the fact that they rely on exit multiples as a shorthand for evaluating their investments. (If

What the Great Fama-Shiller Debate Has Taught Us

Harvard Business Review

At the annual meeting of the American Finance Association in 1969, Fama presented a paper (published the next year in the Journal of Finance ) summing up what he and others had learned about stock market behavior over the previous decade and sketching out a way forward. He suggested taking things a step further, and testing whether the stock market was actually “efficient” in the sense that it “provide[d] accurate signals for resource allocation.”.

Why Those Guys Won the Economics Nobels

Harvard Business Review

The Swedes had given the award to one guy, Eugene Fama , who is best known for originating something called the efficient market hypothesis, another guy, Robert Shiller , who once called the efficient market hypothesis “one of the most remarkable errors in the history of economic thought,” and a third guy, Lars Peter Hansen , whose work is so dense that even academic economists couldn’t satisfactorily explain it or its connection to Fama and Shiller.

Stop Trying to Predict Which New Products Will Succeed

Harvard Business Review

Is market performance predictable for a specific product or class of products? For products that cannot be predicted, we should focus on recognition — on trying to identify as quickly and cheaply as possible whether a product is succeeding when it’s actually introduced in the market, and create production and distribution processes that are flexible enough to adapt to our recognition of success or failure. Look at the variance of your new-market products.