article thumbnail

The Rise of FinTech in Supply Chains

Harvard Business Review

They enable both the buyer and supplier to improve their working capital by making it possible for the former to extend its payables and at the same time accelerate payment to the latter. The use of FinTechs allows suppliers to access funding at the multinationals firm’s lower cost of capital.).

article thumbnail

We Can’t Study Short-Termism Without the Right Metrics

Harvard Business Review

However, higher accruals can reflect either innocuous aspects of certain business models, such as in the construction industry, where the time lag between earning income and realizing cash is long, or that growing firms retain higher working capital to meet greater current and future customer demand.

EPS 8
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

The Most Common Mistake People Make In Calculating ROI

Harvard Business Review

But before anyone writes a check, you need to calculate the return on investment (ROI) by comparing the expected benefits with the costs. Analyzing ROI isn’t always as simple as it sounds and there’s one mistake that many managers make: confusing cash and profit. Financial analysis Project management'

ROI 8
article thumbnail

Finally, Proof That Managing for the Long Term Pays Off

Harvard Business Review

Companies deliver superior results when executives manage for long-term value creation and resist pressure from analysts and investors to focus excessively on meeting Wall Street’s quarterly earnings expectations. This has long seemed intuitively true to us. The returns to society and the overall economy were equally impressive.

article thumbnail

What You Don’t Know About Sales Can Hurt Your Strategy

Harvard Business Review

The goal of strategy is profitable growth, meaning economic value above the firm’s cost of capital. Hence, the customer-selection criteria of sales managers, and call patterns of sales reps, directly impact the first value-creation lever: which projects the firm invests in. But consider the basics.