Harvard Business Review

SEPTEMBER 13, 2017

We found that sustainable and deforestation-free practices created significant financial benefits for all players in the industry’s value chain. Specifically, our analysis found that the net benefits to ranchers ranged from $18 million to $34 million (12% to 23% of revenues) in net present value projected over 10 years.

Supply Chain 8

Supply Chain Net Present Value Retail Cost of Capital 8

Harvard Business Review

JUNE 8, 2018

Business students have traditionally considered net present value, payback period, and hurdle rates as necessary tools to determine which project to select. Digital companies, however, consider scientists’ and software workers’ and product development teams’ time to be the company’s most valuable resource.

Report 8

Report GAAP Net Present Value CFO 8

Harvard Business Review

JULY 15, 2014

At its core, CLV is the present value of all future streams of profits that an individual customer generates over the life of his or her business with the firm. You can then decide on where to focus your marketing, product development, customer acquisition, and retention efforts. x number of years).

Discount 11

Discount Direct Marketing Present Value Customer Loyalty 11

Harvard Business Review

MARCH 19, 2013

The Jesuit Constitutions didn't equip me to do present value calculations. That intensity makes us productive but also can drive us and everyone around us nuts. So, we Type A's can become even more productive by spending a few daily minutes in quiet reflection instead of banging through to-do lists.

Management 14

Management Self-aware Learning-by-Doing Fashion 14

Harvard Business Review

AUGUST 21, 2015

Setting the right price for your product or service is hard. Most customers in most markets are sensitive to the price of a product or service, and the assumption is that more people will buy the product or service if it’s cheaper and less will buy it if it’s more expensive.

Price 8

Price Debt to Equity Ratio Marketing Metrics 8

Harvard Business Review

MARCH 4, 2013

The researchers found that gifts were far more motivating to short-term employees than unexpected cash bonuses, effectively paying for themselves by improving productivity. In some versions of the experiment, a price tag was left on and catalogers were informed of the present's value, to ensure that the employees didn't overestimate it.)

Motivation 9

Motivation Library Short-term Loyalty 9

Harvard Business Review

OCTOBER 16, 2013

Most companies – including the movie studios in Hollywood – over-rely on basic tools like discounted cash flow and net present value. But if you’re on unfamiliar ground – if you’re in a fast-changing industry, launching a new product, or shifting to a new business model – they can be downright dangerous.

Discounted Cash Flow 8

Discounted Cash Flow Net Present Value Comparison Tools 8

Harvard Business Review

DECEMBER 22, 2010

trillion, roughly 10% of gross domestic product (GDP). Consider, for example, that the estimated net present value of obligations under the Social Security system is approximately $8 trillion. There is a great deal of confusion in the popular media about the level of the current budget deficit and outstanding debt.

GDP 15

GDP Net Present Value Crisis Cost 15

Harvard Business Review

MARCH 31, 2017

But having a grasp of terms like EBITDA and net present value are important no matter where you sit on the org chart. After all, if you’re trying to sell a product or strategy, you need to be able to demonstrate that it is both practical and high margin. The Refresher: Net Present Value. Related Video.

Finance 8

Finance Skills EBITDA Net Present Value 8

Harvard Business Review

AUGUST 3, 2018

The company’s first revenues indicate the acceptance of its product or services by customers. Those outlays could be on soft avenues, such as customer acquisition, data breach and safety, regulatory fines, and product enhancement, or on hard assets, such as hardware, servers, and cellphone towers.

Report 8

Report GAAP Company Proposal 8

Harvard Business Review

OCTOBER 15, 2012

By encouraging innovators to define and demonstrate their concepts concretely, the options approach provides both parties in an open innovation partnership with enough information to assess value, determine additional product development requirements, and reach a mutually beneficial agreement, efficiently. Net Present Value ).

Innovation 8

Innovation Execution Net Present Value Open-book 8

Harvard Business Review

FEBRUARY 24, 2014

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. What if I suggested that the best place to look for answers could be the shale oil fields of North Dakota?

NPV 8

NPV Net Present Value Industry Video 8

Harvard Business Review

NOVEMBER 25, 2013

CFOs are more interested in capital investment estimates, net present values, and a clear outline of the trade-offs of any investment. Creating transparency into its operations is the starting point for marketing to help CFOs understand where and how value is being gained or lost, which makes budgeting discussions much more productive.

CFO 8

CFO Short-term Long-term Benchmarking 8

Harvard Business Review

JUNE 22, 2015

. “It’s one of the more popular ways that managers calculate marketing ROI,” says Avery, pointing out that other common ones include calculating the investment payback period, calculating an internal rate of return, and using net present value analysis. If the product has a contribution margin of $5.00 (at the $10.00

Payback Period 8

Payback Period Fixed Costs Analysis Price 8

Harvard Business Review

DECEMBER 2, 2010

Horizon 3 (H3) represents opportunities for future growth that may take the form of new products, services, capabilities, and perhaps extensions into non-adjacencies that show great promise but are highly uncertain. We call this the Opportunity Value (OV) of an asset. This is where Opportunity Engineering comes into play.

NPV 14

NPV Net Present Value Price Engineering 14

Harvard Business Review

NOVEMBER 19, 2015

This requires applying different approaches to strategy and execution in different parts of their business, as well as constantly re-balancing exploitation (generating cash to support growth) and exploration (finding winning products and models). 3M owes part of its innovative success to the “new product vitality index.”)

Company 8

Company Succession Maturity Long-term 8

Harvard Business Review

MARCH 29, 2018

While this might seem like a radical step for hospitals, it is exactly the transition that occurred 100 years ago in the business world in general when companies shifted from a departmental or functional structure to a decentralized, business-unit structure that that was more aligned with and accountable for its products, services, and customers.

Budgeting 8

Budgeting System Innovation Payback Period 8

Harvard Business Review

NOVEMBER 9, 2012

When last year's massive earthquake hit Japan, the effect on electronics production was severe, and it also resulted in extended business disruptions for many in the automotive industry. Let's start by defining what we mean by risk, which is simply the possibility of more than one outcome (of unequal values) to a given future state.

Supply Chain 8

Supply Chain Chief Procurement Officer Risk Management Management 8

Harvard Business Review

FEBRUARY 24, 2011

But why compare apples (book value) to oranges (share price and dividends)? Buffett explains that book value is the best proxy for "intrinsic value," the net present value of all estimated future cash flows. Consider that since 1965, Berkshire's book value grew 434,057% and the S&P index grew only 5,430%.

Letter 15

Letter P&L Net Present Value Insurance 15

Harvard Business Review

APRIL 9, 2015

You might also find that your accounts receivable (A/R) — what customers owe you for services rendered or products delivered — rises by $1 million. You can use one or more of four ROI calculation methods: payback, net present value , internal rate of return, and profitability index. Evaluate the investment.

ROI 8

ROI Analysis Rate of Return Net Present Value 8

Harvard Business Review

DECEMBER 2, 2013

Managers have embraced this kind of thinking not because they have taken a “be nice” pill, but rather because they see that truly effective community programs reduce community risk, and thereby increase the net present value of their assets in developing and fragile states.

Trends 8

Trends Development Net Present Value NGO 8

Harvard Business Review

OCTOBER 3, 2011

Companies that charge too little may have happy customers but will be unable to meet their other financial obligations or offer new and improved products and services to customers. So a successful shareholder value-oriented company must find the price that adds value for both customers and shareholders.

Short-term 12

Short-term Long-term Price CEO 12

Harvard Business Review

FEBRUARY 7, 2011

Anyone who has had to make the argument for an investment knows the basic tool involved: a Net Present Value (NPV) calculation. The overall value of a foreign investment is equal to the NPV of the expected stream of profits for the life of the investment. If the owner of that subsidiary discounts profits in Egypt by 12.5

NPV 13

NPV Short-term Discount Politics 13

Harvard Business Review

MAY 1, 2017

In these circumstances, strategies that generate faster growth create more value for most companies than those that improve profit margins. The Refresher: Net Present Value. Bain recently completed research on workforce productivity. The most productive companies have the talent they need to generate good growth options.

ROE 14

ROE Long-term GDP Six Sigma 14

Harvard Business Review

APRIL 27, 2017

I agree with their vision of a future in which more companies focus on the long term and become more productive for the world (their findings accord with my own work on the dangers of short-termism ). The Refresher: Net Present Value. Related Video.

Hedge 9

Hedge Short-term Long-term NPV 9

Harvard Business Review

DECEMBER 28, 2016

Customer Lifetime Value : This is the net present value of all future customer revenues with account for attrition and your discount rate. It’s either in a state of growth, peak productivity, or decline. Study the drivers and barriers of both to optimize here. Mistake #3: Moving slowly, without purpose.

Attrition 10

Attrition Metrics Net Present Value KPI 10

Strategy Driven

SEPTEMBER 9, 2011

Many conventional metrics we use to estimate value are based on faulty assumptions. Net present value [NPV] is a case in point. You will learn how to identify and prioritize your company’s full portfolio of opportunities – from new product lines to entirely new businesses. But most of your customers don’t care.

Innovation 50

Innovation NPV Business Model Constraint 50