Every company wants to create strong and sustainable value for its owners. But that requires making intelligent, often subtle, trade-offs—between pursuing growth and focusing on margins, between reinvestment and shareholder payouts, and in how to allocate capital and other resources across the portfolio. Find out what it takes to build a strong business and get rewarded for it in the capital markets.
One of the best ways for companies to create superior value is by excelling in portfolio strategy—that is, investing capital across its businesses, products, and initiatives to maximize returns. Companies that don’t systematically allocate capital to their most attractive opportunities risk falling off a “valuation cliff.”
Every leader wants to build a company that is simultaneously a great business and a great stock. Delivering on either of those aspirations is hard enough; delivering on both is a supremely difficult challenge. How do you do it? By crafting a comprehensive value creation strategy that aligns business strategy, financial strategy, and investor strategy.
New demands and technologies push the finance organization into the spotlight. The finance function has undergone a radical shift in the last decade. Investors are more demanding, pushing companies to maximize the value-creation potential of their investments. Inefficient capital allocation is becoming a competitive disadvantage. At the same time, big data, real-time data, and other technological advances are providing new tools for finance to track financial performance. They’re also raising the stakes for excellence in performance management.
