Harvard Business Review

JULY 31, 2017

Based on our recent worldwide survey of 2,000 incumbent companies across all major industries and countries, we estimate that the average return on incumbent digital initiatives is below 10% — barely above the cost of capital. One example is P&G’s Oral-B toothbrush with Bluetooth-enabled digital guidance.

Strategy 8

Strategy ROI Technology Cost of Capital 8

Harvard Business Review

APRIL 9, 2015

It indicates what is left after all costs and expenses are subtracted from the company’s revenue. For example, “revenue” isn’t a cash-based number: A company can record revenue whenever it ships a good or delivers a service to a customer, whether or not the customer has paid the bill. Evaluate the investment.

ROI 8

ROI Analysis Rate of Return Net Present Value 8

Harvard Business Review

OCTOBER 21, 2016

Hoping to alleviate their concerns, this article also provides concrete examples of how sustainability benefits the bottom line. This can disrupt a firm’s ability to operate on schedule and budget. ” Improving risk management.

Supply Chain 8

Supply Chain Price Loyalty Efficiency 8

Harvard Business Review

SEPTEMBER 4, 2017

In The Good Jobs Strategy , Zeynep Ton, a professor at the MIT Sloan School of Management, demonstrates how the best retail companies align their customer value proposition with their operations strategy and their approach to human capital. It’s not money that’s in short supply; it’s good growth ideas.

Human Capital 15

Human Capital Kaizen Agility Energy 15

Harvard Business Review

MARCH 31, 2015

While consumers are rightfully worried that their personal information may be compromised, shareholders and companies’ management have a wider set of concerns, including loss of intellectual property, operational disruption, decreased customer trust, tarnished brand, and loss of investor commitment.

Price 8

Price Long-term Banking Short-term 8

Harvard Business Review

FEBRUARY 7, 2011

Take baseball hitting statistics as an example. We will define skill as "the ability to use one's knowledge effectively and readily in execution or performance" and luck as "events or circumstances that operate for or against an individual." One prominent example is the use of employee stock options (ESOs). 400-plus or sub-.200.

Skills 15

Skills ROIC Sports Cost of Capital 15

Harvard Business Review

APRIL 26, 2017

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. This amounts to putting a toe in the water, while keeping current operations relatively separate and pristine. Eastern Bank).

Banking 11

Banking Stage-Gate Credit Scoring Competitive Advantage 11

Harvard Business Review

JUNE 27, 2012

real revenue and profit growth and earning their cost of capital has steadily declined. About 25 of them did so thanks to the commodity bonanza that unfolded during the last two decades (for example, the price of a barrel of oil has risen from $20 in 1992 to about $100 today). Yet almost every business aspires to do this.

Creativity 14

Creativity Long-term Kotter Cost of Capital 14

Harvard Business Review

OCTOBER 3, 2011

A CEO's job is about resource allocation with a goal of earning a return in excess of the opportunity cost of capital. The challenge is figuring out how to allocate human and financial capital to its best and highest use for the long term. Take M&A as an example. This requires difficult trade-offs.

Short-term 11

Short-term Long-term Price CEO 11

Harvard Business Review

NOVEMBER 25, 2013

Just 36 percent of CMOs, for example, have quantitatively proven the short-term impact of marketing spend, according to the 2013 CMO Survey (and for demonstrating long-term impact, that figure drops to 32 percent). To date, however, the reality of marketing analytics has fallen short of the promise. Why is this so challenging?

CFO 8

CFO Short-term Long-term Benchmarking 8

Harvard Business Review

MAY 14, 2013

In fact, they''re operating at such a comparatively low level that as things stand now, many of them, including utilities, will be able to emit as much carbon as they want for the next decade without hitting their limits. That means future carbon-credit auctions, which help fund clean-energy initiatives, will yield lower revenue.

Price 8

Price Energy Politics Marketing 8

Harvard Business Review

MAY 24, 2017

When Caesars Entertainment, a gaming company, reorganized operations in 2011, the senior team not only developed a database on the performance and the potential of the company’s top 2,000 managers but also analyzed the ability of the top 150 to take on new and different jobs. Invest human capital just like you invest financial capital.

Human Capital 15

Human Capital Management Company ROCE 15

Harvard Business Review

FEBRUARY 7, 2017

New research, led by a team from McKinsey Global Institute in cooperation with FCLT Global , found that companies that operate with a true long-term mindset have consistently outperformed their industry peers since 2001 across almost every financial measure that matters. In this case its capital charge is $800 times 8%, or $64.

Long-term 8

Long-term EPS Short-term Management 8

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

Joint venture deals, for example, actually show returns similar to those of the best acquisitions. Likewise, the airlines have demonstrated that well-constructed alliances can be a powerful way to build market position and capitalize on scale. The old conventional wisdom that most deals destroy value has never been less true.

Incubator 8

Incubator Insurance Cost of Capital Competitive Advantage 8

Harvard Business Review

SEPTEMBER 26, 2016

For example, consider an oil refinery where managers use linear programming to maximize the dollar value of the outputs from the input of a barrel of oil. Anybody who attempts to fight the primacy of shareholder value maximization gets this point thrown in his face – sure, go ahead and let confusion reign.

Objective 8

Objective Cost of Capital Bottom-up Environment 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. Tools for each challenge are presented, backed by examples from companies – from small firms to global giants – that have successfully put these methods into practice.

Innovation 50

Innovation NPV Business Model Constraint 50

Harvard Business Review

MARCH 1, 2017

Most firms cite opportunities to reduce friction and costs. After all, most financial intermediaries themselves rely on a dizzying, complex, and costly array of intermediaries to run their own operations. For example, consider how new business ventures access growth capital.

Finance 8

Finance IPO Banking Venture Capitalist 8