Remove Finance Remove Management Remove NPV Remove Productivity
article thumbnail

How to Improve Your Finance Skills (Even If You Hate Numbers)

Harvard Business Review

If you’re not a numbers person, finance is daunting. After all, if you’re trying to sell a product or strategy, you need to be able to demonstrate that it is both practical and high margin. Stop avoiding finance because you’re afraid of numbers. “Finance and accounting are very simple. .”

article thumbnail

A Refresher on Internal Rate of Return

Harvard Business Review

You’ve got a great idea for a new product that will increase revenue or a new system that will cut the company’s costs. According to Knight, it’s commonly used by financial analysts in conjunction with net present value, or NPV. Finance & Accounting Article. Further Reading. How do companies use it?

Insiders

Sign Up for our Newsletter

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

article thumbnail

Will You Be Writing Off Your Investment in Egypt?

Harvard Business Review

With political upheaval roiling the streets of Cairo, the first concern of top management in many multinationals is to get their employees and their families out of Egypt safely. Anyone who has had to make the argument for an investment knows the basic tool involved: a Net Present Value (NPV) calculation.

NPV 12
article thumbnail

Hospital Budget Systems Are Holding Back Innovation

Harvard Business Review

A second, more radical solution is to create budgets and authority for a service line or integrated practice unit (IPU) that manages a patient’s entire treatment for a high-volume medical condition. The IPU is an essential component of the value-based care model advocated by Harvard Business School’s Michael Porter.

article thumbnail

Stop Focusing on Profitability and Go for Growth

Harvard Business Review

So, in real terms, debt financing is essentially free. Next time you're deciding about a big investment, NPV can help you make a more informed decision. The assets that are truly scarce at most companies are the skills and capabilities required to turn great growth ideas into successful new products, services, and businesses.

ROE 14