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How to Quantify Sustainability’s Impact on Your Bottom Line

Harvard Business Review

We chose Brazil’s beef industry as the location of our case study , both for the size and complexity of the industry and for its impact on the planet. We found that sustainable and deforestation-free practices created significant financial benefits for all players in the industry’s value chain. of revenues).

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Is Your Business Biased Against Innovation?

Strategy Driven

Many conventional metrics we use to estimate value are based on faulty assumptions. Net present value [NPV] is a case in point. Companies that will eventually be wrecked by others’ innovations are operating on autopilot. Two, don’t assume that your firm or even your industry has the answers.

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Match Your Innovation Process to the Results You Want

Harvard Business Review

Incremental innovations can be managed at the operating levels where the people know the customers/consumers best and decisions can be made in a more consensus-driven way with input and agreement between all stakeholder functions. It tends to be short-term, uses familiar (traditional) metrics and development systems like Stage Gate.

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Why Is an App Worth as Much as a Small Oil Field?

Harvard Business Review

While on the surface, the dirty business of fossil fuels is nothing like Silicon Valley, many in the oil business have moved beyond the standard net present value (NPV) model for assessing the merit of investments. But Facebook has also bought itself time to figure out how to extract value from that audience.

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Only the CEO Can Make the Big Bets

Harvard Business Review

Listen up, CEOs: Only you can make the big bets about where your industry's hockey puck is going. In the late 1990s, we presented the Gretzky metaphor to a division of a large, global bank. And using net-present-value estimates for "beginning" ideas is nuts. It's being customer-reactive.

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

Harvard Business Review

The private equity industry has grown markedly in the last 20 years and we know more than we used to about its effects on the economy. ” PE firms typically take three types of value increasing actions — financial engineering, governance engineering, and operational engineering.

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

Harvard Business Review

But having a grasp of terms like EBITDA and net present value are important no matter where you sit on the org chart. The most important concepts to grasp are “how to measure profitability, EBITDA, operating income, revenue, and operating expenses,” he says. The Refresher: Net Present Value.