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When It Pays to Think Like a Finance Manager

Harvard Business Review

If you want approval for a new project — purchasing new equipment or computer systems, applying for a patent, building a new store — chances are you need your company’s finance department on board. To get the green light, it helps to understand how finance people think. Finance & Accounting Tool.

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

Harvard Business Review

If you’re not a numbers person, finance is daunting. Stop avoiding finance because you’re afraid of numbers. Think of it this way, “Finance is the way businesses keep score. “Finance and accounting are very simple. .” “Finance and accounting are very simple. Overcome your fears.

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Will You Be Writing Off Your Investment in Egypt?

Harvard Business Review

Anyone who has had to make the argument for an investment knows the basic tool involved: a Net Present Value (NPV) calculation. The overall value of a foreign investment is equal to the NPV of the expected stream of profits for the life of the investment. Vinod K.

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Hospital Budget Systems Are Holding Back Innovation

Harvard Business Review

operating rooms, recovery floors, emergency department), and ancillary departments (e.g., Consider, for example, a surgical patient who starts in the pre-operative area, then moves to the operating room, the post-anesthesia care unit, and the inpatient floor, with occasional side trips for imaging, testing, and physical therapy.

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Old Buildings Are U.S. Cities’ Biggest Sustainability Challenge

Harvard Business Review

Today large commercial buildings address only two percent per year of the NPV-positive investments in efficiency that are available to them. Addressing energy use in existing large commercial buildings has proven notoriously difficult.

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Case Study: Should a Hotelier Invest in a New Kind of Online Travel Agency?

Harvard Business Review

Lotta, who’d joined Ervaring from Marriott two years before, was the first to admit that her new company, with 12 brands operating 5,000 hotels, mainly in Europe, needed help. ” Negative NPV. “You can see that if you go three years out, the NPV is still negative on our investment. He was getting on my nerves.

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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. Some focus their best people on finding ways to squeeze out more profitability from existing operations, rather than creating new businesses. Related Video.

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