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A Refresher on Payback Method

Harvard Business Review

There are a variety of ways to calculate a return on investment (ROI) — net present value , internal rate of return , breakeven — but the simplest is payback period. What is payback period? ” The shorter the payback period, the better. How do companies use the payback method?

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Walmart Broadens ROI for Green Power

Harvard Business Review

Second, Bedore spoke about how Walmart thinks about its investments in green power: "There is an ROI calculation on all sustainability investments like on all projects, but.we For example] the longer term payback on solar helps us get to scale down the road.". EPA's latest list of the top 50 renewable energy buyers.

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Why We Need to Update Financial Reporting for the Digital Era

Harvard Business Review

Business students have traditionally considered net present value, payback period, and hurdle rates as necessary tools to determine which project to select. Digital companies, in contrast, chase risky projects that have lottery-like payoffs. Risk is now considered a feature, not a bug.

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An Inside View of How LVMH Makes Luxury More Sustainable

Harvard Business Review

Belvedere Vodka, a brand with sales in 120 countries, has pursued many large-scale projects to reduce its CO2 footprint. Charles Gibb, Belvedere’s CEO, says it made a strategic choice to invest in this project, even though it had a longer payback period than normal. LVMH’s approach is somewhat unique.

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How to Get People to Collaborate When You Don’t Control Their Salary

Harvard Business Review

Both these efforts help the payback period arrive sooner, making collaboration a smarter investment for the next wave of people. For major collaboration projects, Dana-Farber assigned coleaders who shouldered the administrative burdens while the superstar researcher provided the thought leadership.

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How to Better Manage Your Company’s Utility Bills

Harvard Business Review

In our experience, well-designed retrofits can deliver 20%-50% energy savings with fast payback periods. Second, major capital events such as renovations or retrofits, which companies typically undertake every few decades, provide the opportunity for even deeper savings given recent advancements in green construction.