Shareholder value can no longer be seen as the latest craze in the corporate classroom. It's grown up. It's redefining the syllabus by which we learn to profit or perish. It has moved into the mainstream of global corporate life where would-be winners can no longer afford to ignore it.Drawing on the experience of PricewaterhouseCoopers' worldwide network of companies and clients, this new edition of a best-selling title will provide you with the key to unlocking the secrets to real wealth creation. The impact of the information revolution, the integration of capital markets, and the increased ability of investors to compare and contrast corporate performance has put shareholder value high on the corporate agenda. These days, investors injecting money into your company are looking for a financial return as good as, if not better than, if they had invested in any other. Today's businesses need to maximize value for their shareholders or watch their share price plummet as investors vote with their feet and transfer their money and their trust into competitors' hands. Benefits In Search of Shareholder Value explains the concept of shareholder value and shows how it can help companies and their managers make better, more informed, and proactive decisions. It looks at the philosophy of value creation and at the global financial environment in which value-based management can thrive, and it transforms the insights of market analysts into management tools that can be used throughout the company to add genuine improvements to performance. The book covers every aspect of learning how to deliver value to your investors, including:* introducing the basic concepts of shareholder value * analyzing the theory and history behind shareholder value * establishing the true cost of your capital * the market's preference for judging performance on cash flow rather than profit and loss * how shareholder value is being applied within emerging economies. * principels of value-based management
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Book Description
Editorial Reviews
Review
"Read this and never again will the financial reports from the markets go over your head." Business Money "In Search of Shareholder Value accumulates our global experience of helping companies to enhance shareholder value. CEOs, CFOs and other senior executives tell us that this continues to be a key priority. I believe this book demonstrates our commitment to contributing to their success." Jim Schiro, CEO, PricewaterhouseCoopers "This is very much a how to book, with plenty of original ideas. The application of its concepts should make a significant contribution to raising management performance." Sir Brian Pitman, Chairman, Lloyds TSB Group plc "SHV creation has become the flag waved by large corporates aiming to build international franchise through easier access to global financing. Philip Wright and Andrew Black enlighten the complexity of the concept... Their book provides an invitation to business managers to think how they may contribute to creating a sound and sustainable basis for economic growth within a balanced social organization." Gerard de la Martiniere, CFO, Axa "Traditional accounting methods do not allow proper assessment of intrinsic value of stocks. Cash is what counts! Value-based analysis is essential for investors to evaluate potential opportunities, and for corporates to run their business more efficiently. [This book] should contribute to make these necessary changes happen." Francois Langlade-Demoyen, Director of European Strategy, Credit Suisse First Boston "ABB has always supported the concept of shareholder value and the time is now right to focus on Value Based Management throughout the business. It provides a good health check for the organization and reassures shareholders that there is alignment of resources around a common goal." Renato Fassbind, CFO, ABB "Creating shareholder value is the objective of every company today. PricewaterhouseCoopers' experience in helping companies on this continuous journey is invaluable. Getting started on the process is sometimes mysterious. This book can help you begin the journey." Steven S. Reinemund, Chairman and CEO, Frito-Lay Inc. "In Search of Shareholder Value gave me the reasons and clear road map for the journey of introducing a value mindset and value management into TPG." Peter Braake, CFO, TPG
From the Back Cover
A powerful blueprint for managing the link between strategy and share price.
* Identifies the key 'value drivers' in any corporation.
* Demonstrates how to align a company's constituent parts in support of enterprise-wide strategies for maximizing shareholder value.
* Draws on the authors' extensive experience as senior partners at PriceWaterhouseCoopers.
More than ever, mastering valuation has become an essential skill for every manager making strategic decisions. In Search of Shareholder Value presents a complete framework for value creation, based on state-of-the-art work at PriceWaterhouseCoopers. This book will help strategic decision-makers understand their organization's key 'value drivers' — and discover how to align every part of the enterprise in support of an effective strategy for maximizing shareholder value. It presents a systematic philosophy and approach to value creation, explains the key measures of shareholder value, and delivers a practical, robust framework for their application in driving company performance.
Endorsed by company leaders from Frito-Lay to Lloyds of London, this book offers clear-eyed analyses of the tradeoffs between risk and shareholder return. Then, the book develops powerful techniques for value-based management, showing how they can be customized and deployed across many global markets and business sectors. The authors outline techniques that can be applied to evaluating mergers and acquisitions; and strengthening value creation in underperforming business. They also introduce breakthrough value reporting performance metrics for evaluating value creation.
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Most Helpful Customer Reviews
2 of 2 people found the following review helpful:
5.0 out of 5 stars
An Author comments !,
By Andrew Black (London, UK) - See all my reviews
This review is from: In Search of Shareholder Value: Managing the Drivers of Performance (Paperback)
I couldn't help but look at some of the reviews, admittedly rather a long time after the 2nd edition now. The book is really designed as a primer on the subject, and also to maintain the links between what is going on in the equity market, and what is going on internally inside the corporates. As such we steered a path between making the book overly complicated and hence off-putting, and between making it overly simple. It was never designed to sell SAP software, as one reviewer suggested, and indeed, its overall position in the PwC offering was less clearcut than it should be. Perhaps to remind readers that it originated from the old PW company might explain rather more. The descriptions and analysis of the models are reasonably correct, including that of the CFROI model - at least judging by the materials I had to hand. The critique on the replacement value of assets and the corresponding weakness of the EVA model is a valid point, made elsewhere, but also picked up in the book I believe. Yes the book has been used extensively by PwC people, but by no means exclusively so. Yes, we did go on to develop a VBM offering out of it, but again not exclusively around the book - though it helped. The combination of the approach (Valuebuilder, which is not for sale), capital markets, consultancy and corporate governance issues remains very useful, and rather distinct from a number of other offerings in the market. So, do continue to buy it and read it !!
5.0 out of 5 stars
Keep it Simple,
This review is from: In Search of Shareholder Value: Managing the Drivers of Performance (Paperback)
I despair of acedemics intent on picking holes in the acedemic rigour of books on shareholder value. Businesses are run by business managers. They leave "trendy" financial concepts for the FD to trot out to the board, in vain and ad infinitum. Bridge the gap between those who run the business and the cerebral numerates who keep score and you will...create shareholder value...hurray. This book does just that.
5.0 out of 5 stars
Easy to read, well laid out for a complex subject,
By
This review is from: In Search of Shareholder Value: Managing the Drivers of Performance (Paperback)
Most people hate lots of numbers and formulas. This book handles them well. This book clearly describes the concepts of Shareholder Value. I think this book, and many of its SV kind, are great for corporate financial people who have (mostly) accurate accounting numbers. But for investors looking in from the outside, SV becomes difficult to implement. For example, what truly is EBITDA? Cash Flow? Which one? These illusive investor numbers make the SV process hard to implement for those of us without access to the real corporate books. Or at least, the process of determining the correct numbers is more difficult than the SV process lets on... in the world where accounting numbers and forecasts can be made to be anything the CEO or CFO want. All in all, this methodology has brought a revolution to the corporate financial world. Divisions can now be compared with more rigor. This book easily and clearly explains the logic. The authors care about their subject and it shows. John Dunbar
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