Harvard Business Review

APRIL 16, 2015

” A quarter century later, not much seems to have changed: fewer than five out of the 100 CEOs on HBR’s 2014 list of best-performing CEOs even mention “return on capital” on their official biography — and none of those five lead companies listed in the Dow Jones Industrial Average (DJIA) or in the EuroStoxx50.

CEO 8

CEO ROIC Cost of Capital Merton 8

Harvard Business Review

APRIL 26, 2017

As JPMorgan Chase’s CEO, Jamie Dimon, warned in a June 2015 letter to the bank’s shareholders, “Silicon Valley is coming.” Banks’ cost of capital is typically 50 basis points or less. This amounts to putting a toe in the water, while keeping current operations relatively separate and pristine.

Banking 11

Banking Stage-Gate Credit Scoring Competitive Advantage 11

Harvard Business Review

MARCH 28, 2016

As a result, family equity can come at a very low cost of capital, where businesses can meet the annual needs of their shareholders without having to worry about paying back the principal. As one client told me, “It used to be that unhappy customers would write a letter. We have to stay out in front of our image.”

Long-term 8

Long-term Short-term Reputation Incentives 8

Harvard Business Review

SEPTEMBER 26, 2016

The oil refinery illustrates the general point that the way you create an environment in which those operating it can make coherent decisions is to choose a variable to optimize and set minimums (and maximums if you wish) for all the other relevant variables. This works regardless of which variable you choose to maximize.

Objective 8

Objective Cost of Capital Bottom-up Environment 8