Harvard Business Review

JULY 25, 2017

Some companies establish a threshold for MROI that takes into account its risk tolerance and cost of capital, below which they are hesitant to make investments. “In principle, managers should try to estimate the full cost of the marketing activity, including creative development, media spend, and customer-facing staff time.”

ROI 8

ROI Marketing Marketing Mix Short-term 8

Harvard Business Review

OCTOBER 10, 2017

For any business to succeed over the long term, it must earn a return that exceeds its cost of capital. It is through continuously making incremental progress in lowering costs and increasing revenues that firms achieve competitive advantage in their industry. Here are four things leaders can do.

Innovation 8

Innovation P&L ROI Long-term 8

Harvard Business Review

OCTOBER 21, 2016

Managing risks therefore requires making investment decisions today for longer-term capacity building and developing adaptive strategies. Disruptions in the supply chain may affect production processes that depend on unpriced natural capital assets such as biodiversity, groundwater, clean air, and climate.

Supply Chain 8

Supply Chain Price Loyalty Efficiency 8

Harvard Business Review

APRIL 26, 2017

Recent analysis by Bain and SAP found that only 7% of bank credit products could be handled digitally from end to end. Banks’ cost of capital is typically 50 basis points or less. These low-cost and reliable sources of funds are from taxpayer-insured deposits and the Federal Reserve’s discount window.

Banking 12

Banking Stage-Gate Credit Scoring Competitive Advantage 12

Harvard Business Review

MAY 4, 2012

By helping to fill this analytical void, CFOs can make it more likely that the market will develop expectations that are grounded in reality. Less Volatility in Stock Price: The net effect of providing guidance is arguably a less volatile stock price, which can result in a lower beta and a lower cost of capital. FD) constraints.

CFO 11

CFO Metrics Price Depreciation 11

Harvard Business Review

NOVEMBER 25, 2013

Without a strong business case built on analytics, marketing too often is seen as a cost rather than an investment, despite marketing’s ability to drive above-market growth. Together with the CFO, the CMO must develop a set of objectives that directly deliver on financial objectives and business goals.

CFO 8

CFO Short-term Long-term Benchmarking 8

Harvard Business Review

MAY 24, 2017

Finding, developing, and retaining this talent is hard — so much so that the business press refers to a “war” for talent. Based on our research , inspired employees are three times more productive than dissatisfied employees, but they are rare. Invest human capital just like you invest financial capital.

Human Capital 15

Human Capital Management Company ROCE 15

Harvard Business Review

DECEMBER 13, 2017

Investors punish companies with a short-term orientation by applying higher discount rates to them, which increases the cost of capital for those companies. In contrast, companies with a long-term orientation are rewarded with a lower cost of capital, which allows them to afford more innovation—a virtuous cycle.

Short-term 8

Short-term Decentralization Company Trends 8

Harvard Business Review

MAY 25, 2018

Mr. Rockefeller’s business strategy was to vertically integrate every aspect of the oil business (exploration, development, logistics, marketing) to assure an ongoing competitive advantage. The most successful will develop clear joint goals and an entrepreneurially enabled management style that focuses more on outcomes than on control.

Incubator 8

Incubator Insurance Cost of Capital Competitive Advantage 8

Harvard Business Review

FEBRUARY 7, 2017

It started with developing a proprietary Corporate Horizon Index. The data for this index was drawn from 615 nonfinance companies that had reported continuous results from 2001 to 2015 and whose market capitalization in that period had exceeded $5 billion in at least one year. In this case its capital charge is $800 times 8%, or $64.

Long-term 8

Long-term EPS Short-term Management 8

Strategy Driven

SEPTEMBER 9, 2011

The logic of NPV is to project cash flows into the future and then discount those flows back into today’s dollars at a given cost of capital. You will learn how to identify and prioritize your company’s full portfolio of opportunities – from new product lines to entirely new businesses. Take a doctor’s office.

Innovation 50

Innovation NPV Business Model Constraint 50