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Moving beyond the strategies that managers have employed to
create shareholder value -- now the standard for business performance -- management
experts James McTaggart, Peter Kontes, and Michael Mankins reveal their powerful
new framework for the systematic, day-to-day management of shareholder value.
The authors attack head-on the fundamental weaknesses in current management practices,
namely, the stranglehold that budgeting has over strategic planning and the lack
of imagination in management plans that prevents real changes and consequences.
They provide a systematic approach to "value based management" that
eliminates these weaknesses, offering proven strategies for managing large, complex
companies to consistently produce superior results for stockholders. Building
on more than 16 years of consulting experience with many of the largest and best-known
companies in North America, Europe and Australia, the authors delineate the fundamental
principles of value creation, as well as the primary obstacles. Starting with
the principle that "cash flows drive value," McTaggart, Kontes and Mankins
show how to create a single governing objective that will enable managers to make
decisions most likely to increase the company's competitive, organizational and
financial strength. Building on the objective of maximizing shareholder value,
they outline the value based management framework that directly links a company's
strategies and organization to its value in capital markets. Using real-world
examples, they describe how to develop business and corporate strategies that
substantially improve competitive position and increase market value, often within
only two to five years. And as most large companies lack the internal processes
necessary to manage for value on a sustained basis, the authors show managers
how to build the five key processes that are institutional value drivers: governance,
strategic planning, resource allocation, performance management, and top management
compensation. Mastering these capabilities is fundamental to the ongoing, consistent
creation of shareholder value over time. All companies,
the authors argue, inherently possess an enormous potential to create higher value
for their shareholders. With hundreds of examples of companies that have successfully
employed the beliefs, principles, and practices of value based management, this
book shows general managers how to generate superior returns and realize their
business's full potential. James M. McTaggart and
Peter W. Kontes are, respectively, the chairman and president of Marakon Associates,
an international management consulting firm they founded in 1978. Michael C. Mankins
is vice president of Marakon Associates and manages the firm's Stamford, Connecticut
office.
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