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10 Reasons Why Every Manager Should take a Finance Course

Great Leadership By Dan

The audience was mostly engineers – program and project managers, the ones in charge of designing and making complex stuff. Caution: when employees feel like owners, no more wasting money on expensive furniture, management boondoggles, or projects with a poor net present value. You can help them feel like owners too.

Finance 246
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Why We Need to Update Financial Reporting for the Digital Era

Harvard Business Review

Business students have traditionally considered net present value, payback period, and hurdle rates as necessary tools to determine which project to select. Some of these ideas contradict traditional financial thinking whereas others seem highly controversial or pessimistic.

Report 8
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What Private Equity Investors Think They Do for the Companies They Buy

Harvard Business Review

” PE firms typically take three types of value increasing actions — financial engineering, governance engineering, and operational engineering. These value-increasing actions are not necessarily mutually exclusive, but it is likely that certain firms emphasize some of the actions more than others.

CAPM 8
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Rethinking Valuation So You Don't Miss a Good Deal

Harvard Business Review

The other is a process called Opportunity Engineering (OE) that instills a different way to look at value. Since the Three Horizons represent different levels of uncertainty, they need to be managed and valued differently. This is where Opportunity Engineering comes into play.

NPV 14
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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? In addition to my work as a financial trainer, I am part owner of a small manufacturing engineering company with a lot of technical employees. Joe Knight. Add to Cart. Of course not.

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Warren Buffett's 2010 Shareholder Letter: What to Expect

Harvard Business Review

But why compare apples (book value) to oranges (share price and dividends)? Buffett explains that book value is the best proxy for "intrinsic value," the net present value of all estimated future cash flows. Consider that since 1965, Berkshire's book value grew 434,057% and the S&P index grew only 5,430%.

Letter 15
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Shape Strategy With Simple Rules, Not Complex Frameworks

Harvard Business Review

While its competitors were spending lavishly on new equipment, ALL repaired decommissioned engines from its "dead fleet," bought used locomotives from African carriers, and replaced damaged sections of the main line with dismantled tracks from abandoned parking stations.