article thumbnail

Why Accounting in Business is Important

Strategy Driven

Profitability In business, profitability is defined as the income generated by a company from sales of products or services. Liquid assets are cash, securities, receivables, and other financial assets that can be converted into cash within a short period, like a day or two.

article thumbnail

Collaboration as an Intangible Asset

Harvard Business Review

Interestingly, intangible assets are all the rage these days on Wall Street. Interestingly, intangible assets are all the rage these days on Wall Street. Most intangible assets are real but invisible, and the most important invisible ability is the ability (or, perhaps better said, the probability) to collaborate.

Insiders

Sign Up for our Newsletter

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

article thumbnail

How to Make Organizational Change Enduring

Six Disciplines

There is still a whole notion of focusing on tangible assets and their impact on the bottom line, rather than the intangible assets, which are people. Change initiatives typically devote most budgets to structural issues such as technology and processes, not staff issues. Organizations don''t adapt to change; their people do.

article thumbnail

What Younger Workers Can Learn from Older Workers, and Vice Versa

Harvard Business Review

What we asked people was, at this point in their lives, are they actively building, maintaining, or depleting their tangible and intangible assets? Actively building both tangible and intangible assets is crucial to creating a long and productive working life. How to be financially proficient.

article thumbnail

What VW Didn’t Understand About Trust

Harvard Business Review

In a strange way, VW’s chicanery only reinforces how important it is for products today to be environmentally safe. Decades ago, a company’s market value was nearly equivalent to its tangible assets—buildings, machinery, materials, financial capital, and so on. How many car buyers will trust VW now? Is it toxic?

article thumbnail

Do You Know What Your Company’s Data Is Worth?

Harvard Business Review

Data contributes not only to brand equity, but to what constitutes product and service delivery in globally connected and hyper-competitive markets. Using the same formula, Apple’s intangible assets in 2014 were $280 billion — or almost twice the value of its 2015 calculation.

article thumbnail

Why Financial Statements Don’t Work for Digital Companies

Harvard Business Review

For an industrial company dealing with physical assets and goods, the balance sheet presents a reasonable picture of productive assets and the income statement provides a reasonable approximation of expenses required to create shareholder value. Many digital companies have no physical products and have no inventory to report.