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Why Leaders Are Still So Hesitant to Invest in New Business Models

Harvard Business Review

As technology continues to change and challenge even the most successful incumbent organizations in every industry, the cost of inertia is growing. Consider the dramatic shift in the types of assets that create market value. Reactors take a conservative approach to capital allocation and prefer physical assets.

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What’s Driving Superstar Companies, Industries, and Cities

Harvard Business Review

We focus on economic profit rather than revenue size, market share, or productivity growth because these other metrics risk including firms that are simply large and may not create economic value. Acquisitions, bold investment in intangible assets, and attracting talent can ultimately make the difference.

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What VW Didn’t Understand About Trust

Harvard Business Review

Decades ago, a company’s market value was nearly equivalent to its tangible assets—buildings, machinery, materials, financial capital, and so on. In 1975 intangible assets were just 17% of the market value of the S&P 500. Take the example of what’s happening in the food industry.

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Why Financial Statements Don’t Work for Digital Companies

Harvard Business Review

In contrast, industrial giant GE’s stock price has declined by 44 % over the last year, as news emerged about its first losses in last 50 years. Why do investors react negatively to financial statement losses for an industrial firm but disregard such losses for a digital firm?

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Investors Today Prefer Companies with Fewer Physical Assets

Harvard Business Review

Since the industrial revolution, companies have raced to accumulate the most raw materials, properties, plants, and equipment, believing that owning and having more was the equivalent of being worth more. that companies own compared to other assets. that companies own compared to other assets. This is quite a shift.

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Startups Could Fundamentally Change the Way Big Investors Operate

Harvard Business Review

Innovation has the potential to transform the investment industry. This disconnect is a major problem for the continuing development of efficient capital markets. Collectively, the world’s investment giants hold in excess of $70 trillion in assets, which represents the bulk of investable capital globally.

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Why Family Businesses Come Roaring out of Recessions

Harvard Business Review

Tobin’s q is the ratio between a company’s market capitalization and the replacement cost of its tangible assets, with a higher ratio indicating that a company has more intangible assets such as patents, brands, leadership etc., Leadership Marketing'