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When It Pays to Think Like a Finance Manager

Harvard Business Review

Do you think they’re going to do a net present value (NPV) analysis that shows they don’t need that computer? If the numbers show a negative NPV, meaning that the proposed investment isn’t justified, they change the assumptions until the NPV turns up positive. Of course not. ” Guess what? billion.)

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The Worst Failure of All Is Wasting a Failure

Harvard Business Review

The CEO and CFO responded with, "A failure to hit ROI and NPV targets." Clearly the company was painfully aware of these two failed projects. The problem came with the follow-up question, "Why did example A fail?". The head of R&D remembered it as a failure to properly market the innovation.

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

Harvard Business Review

Lotta Tindal, the chief marketing officer for the Dutch hospitality group Ervaring Hotels & Resorts, hadn’t wanted to come to the presentation, but Gerard Bakker, Ervaring’s CFO, had twisted her arm. ” Negative NPV. “You can see that if you go three years out, the NPV is still negative on our investment.