Moving on from ROI to ROE, a Return on Empathy

Strategy Driven

Those making this shift will gain a significant ROE – Return on Empathy. Mark Ingwer PhD is a consumer psychologist and the managing partner of Insight Consulting Group , a global marketing and strategy consultancy specializing in market research and consumer insights. You just finished reading Moving on from ROI to ROE, a Return on Empathy ! The post Moving on from ROI to ROE, a Return on Empathy appeared first on StrategyDriven.

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Leading by Cause

Lead Change Blog

He opened the dialogue, saying he and his leadership team had put a lot of thought into where they want to take their bank, and the vision they committed to was to deliver top decile ROE, ROA and topline revenue growth: a quintessential example of focusing on effect, not cause. Logic tells us we can manage cause, but only measure effect. How effective is the collaboration between product management, manufacturing, and sales?” .

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End the Religion of ROE

Harvard Business Review

corporation than "what's the ROE on that?" ROE justifies the means. To an extent not widely recognized, it was an equation in the first place that gave ROE the power to dominate not just investment decisions, but an entire business culture. By parsing ROE into the DuPont Equation (very rapidly to become a business school mainstay), he provided the basis for organizations divided into functions with their own objectives. There is no more powerful question in a U.S.

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12 Core Competencies For Great Leadership

Lead Change Blog

They thrive on facts, figures and numbers—whether it’s ROI, ROE, or EBIDTA. At the end of the day, leadership means being the one person who manages people; who fosters vision and change; who facilitates collaboration and communication; who brings together critical thinking, organizational knowledge, and strategic acumen; and who concentrates on getting results.

Why Complexity Sucks

In the CEO Afterlife

You focus on that 20% to generate a high ROE (return on effort). More on complexity and the road-tested strategies that cut through the clutter can be found in the pages of my new book for leaders, managers, innovators, and entrepreneurs. Complexity is in the eye of the beholder. To me, astrophysics is a complex discipline; to Stephen Hawking it is not.

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Stop Focusing on Profitability and Go for Growth

Harvard Business

Equity cash flows, in turn, are a function of a company’s long-term return on equity (ROE), growth, and the value of shareholders’ equity on its books. This relationship gives rise to three important heuristics: If a company’s long-term ROE is anticipated to be 400 basis points (bps) or more above its cost of equity capital, then the value created by accelerating growth will exceed the value created by improving pre-tax margins.

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Not All Metrics Are Created Equal

N2Growth Blog

The best managed companies measure all 5 categories (as well as various subsets) with their focus being on items 3 and 5. Quantitative Return Drivers: Metrics such as Return on Assets (ROA), Return on Equity (ROE), Return on Investment (ROI), Return on Cash (cash-on-cash), and Return on Human Capital (ROHC) will give you more useful information than the static calculations mentioned above. By Mike Myatt , Chief Strategy Officer, N2growth.

Life In A High-Performing Company – An Insider View

Tanveer Naseer

Indeed, these organizations roughly double industry averages on five-year ROA, ROI and ROE. As the social contract surrounding the employment relationship has been rewritten, employees have become increasingly aware that they are responsible for managing their own careers. At function-head level and above, however, Most Admired companies pay 10 percent more on average – and when bonuses are taken into account senior managers earn upward of 20 percent more than their counterparts.

A Refresher on Return on Assets and Return on Equity

Harvard Business Review

I talked with Joe Knight, author of the HBR TOOLS: Return on Investment and co-founder and owner of , to learn more about these ratios and how managers can use them. This is called “denominator management” Not all “denominator management” is fraudulent, says Knight. What is Return on Equity (ROE)? Unlike ROA, you want the ROE to be as high as possible, but there are limitations.

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How Companies Can Use Investors to Their Advantage

Harvard Business

When Bain & Company recently surveyed 51 top global executives about their investor relationship management practices, we learned that while most of them communicate at least monthly with investors and are segmenting their investor base for differentiated emphasis in communications, fewer than 6% of the companies involved have a formal structure in place to link investor relations with strategy and best utilize investor feedback. Heini Wehrle/BIA/Minden Pictures/Getty Images.


Japan Is Counting on Shareholder Activism to Improve Its Economy

Harvard Business

In Japan several factors combine to help insulate managers from outside influence, including cross-holdings where the company owns shares in a partner firm, docile boards mostly composed of company executives, and a court system historically biased against investment funds. Rather than berating management publicly, these funds have led quiet discussions behind closed doors. Pioneer funds of this approach include Asuka Value-up, Taiyo Pacific, and Simplex Asset Management.

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Women's Leadership Exchange - Blog - I Won't Say Good Bye to Ann.

Women's Leadership Exchange

She founded the North Dallas Democratic Women to give more power to women in the Democratic Party in the sixties, and managed her first campaign in 1972 to elect Sarah Weddington to the Texas Legislature. Weddington, you may note, " had successfully argued Roe v. Home WLE Events New York Los Angeles Ft. Lauderdale Connect with Your Customer Conferences Teleseminars Speed Coaching WLE Toolbox WLE Exchange (e-newsletter) WLE Bookstore Blog SELLsation!

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How Office Dwellers Can Become Doers

Harvard Business Review

But let's face it, Microsoft won't pay you to conquer the Amazon or extract salmon roe. Creativity Managing yourself Personal effectivenessI've often fantasized about hurling my laptop over Niagara Falls, then grilling a fresh salmon to celebrate my sensory liberation. I'd become a Maker. I'd build a sailboat to circle the globe. I'd live off the sea, fending off killer whales and Somali pirates. I'm not alone in yearning to resuscitate my flabby Tweeting muscles.

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Would You Want Carl Icahn to Run Your Company?

Harvard Business Review

Yet when Icahn doesn't actually get the reins, he often does some good — shaking up complacent boards and management and motivating them to do what it takes to raise their company's share price and get him to go away. The typical modern shareholder is a fickle, impatient money manager who only holds onto a stock for a few months (yes, there are lots of admirable exceptions; in general, though, my description fits the data).

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Don't Confuse Engagement with User Experience

Harvard Business Review

While it's completely understandable why designers, product managers and marketers might conflate them, reality suggests that a great user experience doesn't necessarily generate engagement any more than meaningful engagement inherently assures a great user experience. Put another way, Apple's UX metric seems to encourage ROE — Return on Engagement — where Android emphasizes ease-of-use and opportunity.

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Women Directors Change How Boards Work

Harvard Business Review

And while research about financial performance is still in its infancy — Catalyst has found a strong correlation between the number of women on boards and in the C-Suite and ROI and ROE of company returns — we’re starting to learn more about the important ways women are changing the inner workings of boards. More effective risk mitigation and crisis management, and a better balance between risk-welcoming and risk aversion behavior.

Idle Funds are the Devil's Playground

Harvard Business Review

He cited the International Monetary Fund's 1997 judgment that "Malaysia is a good example of a country where the authorities are well aware of the challenges of managing the pressures that result from high growth and of maintaining a sound financial system amidst substantial capital flows and a booming property market." The result has been an economic system built increasingly around the maximization of ROE.

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