INDEX
- A
- Academic researchers, life-cycle framework (usage), 164, 167–168
- Accounting, 112–113, 133, 221, 224
- Action, correlate, 66
- Active portfolio managers, success (factors), 164–165
- Adaptability, 181
- Aha! moment, achievement, 69
- Alibaba, e-commerce, 210
- Allison, John, 230
- Amazon, 93–96, 94f, 98, 115f, 184, 188
- Amazon Web Services (AWS), innovation, 96
- Ames Demonstrations, 36–37
- Ames Distorted Room, 36–37
- Ames, Jr., Adelbert, 35, 36
- Anderson, William, 197–198, 221
- Apple, 87, 182
- Arbitrage Pricing Theory, 101, 104
- Artificial intelligence (AI), usage, 193
- Assets, 5, 134, 152, 156
- Assumptions, challenge (importance), 62
- Avon, 148–150, 149f
- B
- Backward-looking discount rate, 55
- Balanced Scorecard, 172–173
- Balance sheets, accountant calculation, 124
- Barton, Dominic, 68
- Batch manufacturing, bottlenecks, 63
- Behavioral Theory of the Firm, A (Cyert/March), 10
- Behavior (improvement), theory (usage), 50–51
- Best practices, adoption, 234
- Beta, usage, 5, 104, 155, 219
- Bezos, Jeff, 93, 95, 142, 188
- Black box, 8
- Blockbuster, physical stores (usage), 184
- Board of directors, impact, 71, 166
- Boroditsky, Lera, 41
- Brands, 121–122, 129–132
- Business, 107, 132–133
- Business-as-usual assumption, 72
- Business-as-usual avoidance, 133
- Business-as-usual mindset, 26, 98
- Business-as-usual reinvestment, 166, 197
- Business-as-usual restructure, 166
- Byrne, Art, 73
- C
- Capital, 85, 123
- Capital Asset Pricing Model (CAPM), 5, 101, 105–106, 157, 218–219
- Capitalism, 229, 235–237
- Capitalism, Socialism, and Democracy (Schumpeter), 9
- Capital stock, growth, 16–17
- Carey, Dennis, 68
- Caro, Tim, 50
- Cash flow return on investment (CFROI), 83, 88–89, 89f, 158–159
- Cash flow return on investment percentage (CFROI%)
- Causality, 38–39, 158
- Cause and effect, 48–49, 62–63, 66
- Cause-and-effect logic, 157–164, 161f, 170–171
- Chandler, Alfred, 11, 15
- Charan, Ram, 68
- Chief Engineers (CEs), role, 173–174
- China, 209–211
- Christensen, Clayton, 51, 160
- Coase, Ronald, 8
- Cohen, Lauren, 163
- Colleague Letter of Understanding (CLOU), 202
- Collison, Patrick, 214, 230
- Command-and-control structure, 77
- “Common Stocks at the Current Price Level” (Rose), 85
- Common words, usage, 64
- Compensation packages, design, 171–172
- Competition, 12, 84
- Competitive advantage, 4–5, 31, 217–218
- Competitive decline, avoidance, 145
- Competitive fade stage, 85–86, 188–189
- Competitive life cycle, 84–90, 183f
- Competitive threat, absence, 42–43
- Competitors, impact, 165–166
- Complex systems, performance (improvement), 41
- Conflict resolution, achievement, 202
- Connectivity-enabled business models, new economy (relationship), 123–126
- Constraints, theory, 60–64
- Consumer needs, range, 210
- Conversations, role, 41
- Corporate culture, impact, 153
- Cost
- “Cost Accounting--Public Enemy Number One of Productivity” (Goldratt), 175
- Costco, 145–148, 147f
- Cost of capital, 5, 134, 139–140
- Covariance, term (usage), 105
- Cowen, Tyler, 21, 214, 230
- Creativity, keys, 69
- Credit quality, independent variable, 102
- Crony capitalism, term (usage), 216
- Crossover, problem, 169, 170f
- Culture, 28, 44–48, 75–78
- Culture of Growth, A (Mokyr), 20
- Cyert, Richard, 10
- D
- Daimler-Benz/Chrysler, merger of equals, 132
- Dalio, Ray, 33–34, 40
- Danaher Business System (DBS), 76–77
- Danaher Corporation, 75–77, 159
- Data, organization, 172
- Decision making, improvement, 133, 171
- Deficient asset pricing model, 156
- Depreciation method, 114
- Design thinking, 69
- Dewey, John, 36
- Diether, Karl, 163
- Discounted cash flow (DCF), 97f, 157
- Discount rate, 101–103, 116–120, 130f
- Disney, streaming service, 187
- Dissipation, cause, 92
- Dividend payouts, 111
- Dodd, Dominic, 53
- Dot-com bubble, 103
- Drucker, Peter, 10–11, 233
- Duggan, William, 69
- Dynamic capabilities, building, 16
- E
- Earnings, adherence, 135
- Earnings/book ratio, 112–113, 113f
- Eastman Kodak, bureaucracy, 72
- Eccles, Robert, 139
- Economic growth, 11, 16–24
- Economic return, 111, 138, 141, 169, 175–176
- Economic value added (EVA), 176–177
- Education, purpose, 231
- Effect-Cause-Effect logical tree, construction, 63
- Efficiency, gains, 26, 106
- Efficient market hypothesis, 104, 153–157, 167
- Employees, 46–47, 57, 75
- End of Accounting and the Path Forward for Investors and Managers (Lev/Gu), 174
- “Engineer as an Economist, The” (Towne), 7
- Enron, 107–109
- Entrepreneurs, term (usage), 209
- Environmental, social, and governance (ESG), 24, 154–155, 160
- Environment, protection/sustainability, 27, 107, 217
- Equity cost of capital, CAPM basis, 105
- Erhard, Werner, 45, 64, 234, 235
- Evolutionary Theory of Economic Change, An (Nelson/Winter), 12
- Excess return, question, 150
- Exogenous shock, study, 163
- Expenses, revenues (matching), 133
- Experimentation, usefulness, 137
- F
- Facebook, platform value, 126
- Factor zoo, 153–157
- Fade rates, 85–86, 117–118, 138f
- Failing business model stage, 86–87
- Fama, Gene, 155–156
- Favaro, Ken, 53
- Feedback, 26, 145, 152, 226
- Felin, Teppo, 40
- Finance, roots, 103–106
- Financial Accounting Standards Board (FASB), software development cost ruling, 126
- Financial crisis (2007-2009), 230
- Financial leverage, 111, 119–120
- Financial performance, 162, 166
- Fink, Larry, 24
- Firm, pragmatic theory, 3, 7–16, 30–32
- Firms, 71–73
- analysis, 6, 215
- assets, value (treatment), 99
- competitive life cycle, 84–89
- cost of capital, long-term benchmark, 110
- earnings/book ratio, simulation, 113, 113f
- financial performance, decomposition, 162–163
- future investments (knowledge), stock price (usage), 99–101
- global industrial firms, aggregate CFROIs, 89f
- historical studies, 168
- knowledge building, proficiency, 43, 219
- life cycle, 32, 100f
- life-cycle track record, importance, 223–224
- long-term performance, cause, 30–31
- low PE firms, investor purchase, 215–216
- management, 46, 170–172
- market valuation, understanding, 5, 218–219
- market value, brands (impact), 129–132
- operations/management decisions, data organization, 172
- percentage future, 100f
- performance, 30–35, 44–48, 153
- projects, portfolio, 112f
- purpose, 4, 24–30, 29f
- purpose-based view, 77–78
- return on investment (ROI), financial performance metric, 134
- risk, 31, 81, 82f, 106–110
- role, understanding, 23
- stages, 85–86
- stakeholders, win-win relationships (sustaining), 26–27, 107, 217
- stock price, co-movement (beta), 5
- success, 218
- track record, usefulness, 111
- transactions cost theory, 8–9
- types, 200
- Firth, Chris, 39
- Fisher, Irving, 84
- Flatley, Jay, 152
- Flourishing, importance, 21–22
- Flow, 61, 175
- Focusing Capitalism on the Long Term (FCLT), 24
- “Focus on the core” (management truism), 188
- Ford, Henry, 16, 29, 55
- Fortive Corporation, 76–77
- Forward-looking discount rate, 54–55, 102
- Forward-looking market-implied discount rate, 101–103
- Free-market capitalism, 216, 229
- Free-market economy, trust (importance), 237
- French, K.R., 155–156
- Frigo, Mark L., 81–82
- Future cash flows, 99, 132
- Future net cash receipts, 120, 175, –176
- Future of Jobs Report (World Economic Forum), 214
- G
- GDP Deflator, usage, 111–112, 136
- General Motors, Toyota (joint venture), 58–59
- Geographical diversity, 210
- George, Bill, 3, 4
- Gerstner, Lou, 42–43, 196
- Global industrial firms, aggregate CFROIs, 89f
- Goal, The (Goldratt), 60, 234
- Going concern, 136
- Goldratt, Eli, 60–64, 175, 234
- Gordon, Robert, 19, 20, 23
- Grant, Robert, 14
- Greeven, Mark, 211
- Grove, Andy, 203
- Growth, language (improvement), 18–19
- Gu, Feng, 121, 173
- Guthart, Gary, 191
- H
- Haier Group, 204–209, 205f, 218
- Hamel, Gary, 53
- Handbook for New Employees, 203
- Harrington, Mike, 203
- Hastings, Reed, 184
- Hayek, Friedrich, 182
- Hess, Edward D., 33, 40
- High-innovation stage, 85
- Holborn Gray, Hanna, 231
- Hollis, Nigel, 121–122
- Horizontal flows, usage, 171
- “How Competitive Forces Shape Strategy” (Porter), 14
- Human behavior, 44–48, 64–69
- Human capital, treatment, 224
- Human nature, control-theory version, 44
- Human resources (HR), elevation, 68
- Hypotheses, usage, 49–50
- I
- IBM, restructuring, 196
- Ideas, usage, 18, 64–65
- IDEO, 69
- Illumina, 150–153, 151f, 160
- Implementation obstacles, overcoming, 57
- Indigenous innovation, impact, 22–23
- Industrial firms, 89f, 101f
- Inflation, 83, 97, 103, 136–137
- Information limitation, 199
- Information technology, 19–20, 128–129
- Innovation, 26, 53, 69–71, 106
- Intangible assets (intangibles), 121, 126–129, 133–142, 223–224
- Integrated Reports, usage, 139–142, 174, 223
- International Accounting Standards Board (IASB), IFRS control, 126
- International Financial Reporting Standards (IFRS), 126
- Internet of Things (IoT), exploitation, 193
- Intuitive Surgical, 27, 188–191, 190f
- Inventor CEOs, focus, 189
- Investments, 25, 99, 116, 133
- Investors, 107, 116–120, 134, 164–165
- Iverson, Ken, 199, 202
- L
- Language, 41–42
- Leadership, 67, 211
- Lean companies, flow (maximization), 175
- Lean Thinking, 23, 47–48, 55–60, 68, 70, 220
- Learning, 15, 44, 76–77, 171
- Learning-and-memory, 69–70
- Lev, Baruch, 121, 135, 174
- Life cycle (firms), 32f, 100
- Life-cycle framework, 86f, 87, 164–168
- Life-cycle guideposts, 182–183
- Life-cycle performance, 32, 81, 123
- Life-cycle position, 181
- Life-cycle reviews, 139–142, 167, 223
- Life-cycle stages, 85–87, 158, 183f, 191
- Life-cycle track records, 88, 165–167, 214, 218, 221–224
- Life-cycle valuation model, 54, 83, 96–98, 97f, 136
- Linear business, customer gain, 125
- Litman, Joel, 81–82
- Lobbying, cessation, 227–228
- Logan, Dave, 67
- Long-term competitive advantage, source, 4–5
- Long-term cost of capital, 88–89
- Long-term economic return, 88
- Long-term fade forecasts, adjustment, 138
- Long-term forecasts, display, 165
- Long-term investment, usage, 165
- Long-term value, 171–172
- Long-term value creation, 68–69, 133, 142, 223
- Low PE firms, investor purchase, 215–216
- M
- Mackey, John, 24
- Malloy, Christopher, 163
- Management, 163–167, 225–228
- Managerial decisions, improvement (source), 6, 220–221
- Managerial skill, importance, 84
- Manufacturing, societal benefits, 29–30
- March, James, 10
- Marginal costs, reduction, 125
- Market
- Marshall, Alfred, 7
- Mass customization (Haier strategy), 208
- Mass Flourishing (Phelps), 21
- Mature stage, 86
- McConnell, David, 148
- McCoy, Bowen H., 3
- McGovern, George, 225–226
- McGrath, Rita, 81
- Medinsky, Vladimir, 185
- Merger of equals (Daimler-Benz/Chrysler), 132
- Michelin, management assumptions, 182–183
- Microeconomic theory, 12
- Middle class, consumer demands (increase), 210
- Miller, Merton, 103
- Modigliani and Miller (M&M), 103
- Modigliani, Franco, 103
- Mokyr, Joel, 20, 21, 23
- Money management, life-cycle framework (application), 164
- Money managers, buy/hold/sell decisions, 164–165
- Morning Star Company, 200–201
- N
- National Cash Register (NCR) Corporation, 194, 196–198, 221
- “Nature of the Firm, The” (Coase), 8
- Negative amortization loans, 229–230
- Nelson, Richard, 12, 13
- Neoclassical economics, impact, 8, 124–125
- Neoclassical growth model, 17–18
- Net cash receipts, 102, 116f, 117, 120
- Netflix, 172, 183–188, 186f, 200
- Net present value (NPV), 72, 73
- Network connections, platform facilitation, 125
- New Economy, 15, 71, 123–126, 224
- Newell, Gabe, 203
- New United Motor Manufacturing, Inc. (NUMMI), 58–60
- Nokia, 90–93, 91f
- Nokia Siemens Networks (NSN), 92
- Nonconstraint activities, subordination, 62
- Nonlinear system complexities, impact, 38–39
- Norton, David, 172
- Nucor, 161–162, 199–200, 202–203
- O
- Office of Strategic Management, activities coordination, 173
- Ohno, Tachi, 55, 56
- Old Economy, 15, 71, 123
- Ongoing improvement, TOC process, 62
- Ontological/Phenomenological Initiative, 235
- Ontological/phenomenological model (OPM), 64–69, 65f, 220, 235
- Operating performance, improvement (source), 5, 219–220
- Oppenheimer, Franz, 227
- Organizational (intangible) capital, development, 128
- Organizational learning, 15
- Organizational structure, 181, 198–204, 199f
- Outlays, proposals, 72–73
- Outperformance, trend, 89
- P
- Paranoid optimism, 92
- Pasteur, Louis, 49
- Patterson, John H., 196
- Peloton Interactive, brand (usage), 131–132
- Penman, Stephen, 105
- Penrose, Edith, 9, 15
- Percentage future (%future), 100f, 101f
- Perception (knowledge-building loop component), 39
- Perceptual control theory (PCT), 44–45
- Perfection, pursuit, 57
- Performance, 65, 67, 70, 134, 235
- Phelps, Edmund, 21–23, 75
- Platt, John, 49
- “Politician's Dream Is a Businessman's Nightmare, A” (McGovern), 226
- Politics, impact, 224–230
- Porter, Michael, 14–15, 24
- Powers, William T., 44
- Preston, James, 150
- Price variable, usage, 9
- Principles of Economics (Marshall), 7–8
- Principles of Scientific Management (Taylor), 7
- Process insights, 70
- Process variables, usage, 171
- Productivity, 47–48, 162
- Product prices, decrease, 72
- Profitability, 32, 127
- Progress, achievement, 213
- Progress Studies, 214, 230–238
- Project ROIs, time series, 111
- Projects, portfolio, 112f
- Prosperity, 21–22, 26, 106, 216–217
- R
- Rajan, Raghuram G., 213, 216
- Rales, Steven/Mitchell, 76
- Randolph, Marc, 184
- Real asset growth rate
- Red Bull, launch, 130–131
- Regression equation, financial leverage (usage), 119–120
- Reinvestment, importance, 141
- Reinvestment rates, 111, 175–177
- Relative wealth index
- Rendanheyi organizational structure, 207
- Repeal and replace, 226
- “Report of the Committee on Freedom on Expression” (Holborn Gray), 231
- Research and development (R&D), 132–133, 141, 174, 211
- Residual income, usage, 176
- Resource allocation, 53, 54f, 71–75, 236
- Resource-based view, focus, 13
- Resource cost, 61
- Resources consumed, historical cost, 134
- Return on investment (ROI), 97, 111, 114, 134, 171
- Return on net assets (RONA), 88, 114, 166, 169
- Revenues, expenses (matching), 133
- Rise and Fall of American Growth (Gordon), 19
- Risk, 106, 109, 219
- Romer, Paul, 17–18, 125–126
- Rometty, Ginni, 229
- Rose, Dwight C., 84–85
- Rother, Mike, 58, 75
- Rufer, Chris, 200–201
- Ruimin, Zhang, 204, 206–208, 210
- Rule-makers, 133, 134
- Rumelt, Richard, 220
- S
- Samsung Electronics, quality control problems, 108
- Scale and Scope (Chandler), 11
- Scale insights, 70–71
- Scenario-based thinking, usage, 92
- Schein, Edgar, 181–182
- Schultz, Howard, 143, 145
- Schumpeter, Joseph, 9, 10, 15, 236
- Schwab, Charles, 26
- Securities and Exchange Commission (SEC), rules implementation, 136
- Self-Management, philosophy, 201–202
- Selim, Omar, 154
- Selling, general, and administrative (SG&A) expenditures, 129, 133, 137
- Setup times, order-of-magnitude reductions, 73–74
- Shareholder returns, 121, 122f, 157–164, 161f
- Shareholder Value Added (SVA), 193
- Shareholder value, maximization, 25–26, 224–230
- Short-term performance, long-term value (balance), 171–172
- Siilasmaa, Risto, 90, 92
- Simulations, usage, 167–168
- Sinegal, James, 146
- Sleeping money, usage, 73
- Smart management, focus, 163
- Smith, Adam, 11, 84
- Smith, Brad, 28
- Smith Corona, 194–198
- Smith Premium Typewriter Company, Corona Typewriter Company (merger), 194
- Solexa, acquisition, 152
- Solow, Robert, 17
- Specialized language, 57
- Stakeholders, 26–28, 107, 217
- Standard and Poor's 500 Index, performance, 160, 189
- Starbucks, 129–130, 143–145, 144f
- “Statement on the Purpose of a Corporation” (Business Roundtable), 224–225
- State, The (Oppenheimer), 227
- Steam (Valve), 203
- “Stick to the knitting” (management truism), 188
- Stimulus/response mindset, 45
- Stock market, 84–85, 115–116, 150–153
- Stock prices, 5, 99–101, 151f, 164, 219
- Stock returns, predictability (difficulty), 157
- STOXX Europe 600 stock index, Nokia performance (contrast), 90
- Strategy and Structure (Chandler), 11
- “Strong Inference” (Platt), 49
- Supply chain software, 122–123
- Survival, 26, 106, 217
- Sustainability, 139
- System constraint, identification, 62
- System principles, 168–177
- T
- Tangible assets, 86, 126
- Target condition, workplace focus, 58
- Taylor, Frederick, 7
- Technological change, 131–132
- Technology, advancements, 236
- Theories, usage, 48–49
- Theory of Constraints (TOC), 42, 61f, 62–68, 70, 174, 220, 234
- Theory of Jobs to Be Done (Christensen), 51, 160, 161
- Theory of the Growth of the Firm (Penrose), 9
- Thinking Processes, 62–64, 67–68
- Three Laws of Performance, The (Zaffron/Logan), 67
- Total assets, long-term economic return, 88
- Towne, Henry R., 7
- Toyota, 58, 173–174
- Toyota Production System, 23, 47–48, 55, 61, 75
- Trading liquidity, independent variable, 102
- Transactions cost theory, 8–9
- Transparency, increase, 228
- True earnings, calculation, 133
- Trust, importance, 237
- T-shaped people, value, 203
- W
- Waldron, Hicks, 148
- Walker, Francis A., 84
- Walmart, 98, 146, 184
- Waste elimination, Lean Thinking (comparison), 234
- Weighted average cost of capital (WACC), 119
- Wei, Wei, 211
- Winter, Sidney, 12, 13
- Win-win partnership, confidence, 47
- Win-win relationships, sustaining, 26–27, 107, 217
- Wiremold Company, knowledge-building proficiency, 73–74
- Womack, James, 56
- Work, 47, 53–55, 54f
- Work-in-process inventories, 56
- Work-in-progress, 141
- Workplace, value stream organization, 74
- Worldview, 38–46, 118–119
..................Content has been hidden....................
You can't read the all page of ebook, please click here login for view all page.