贝恩－业绩评估-CorporatePerformanceMeasurement

Author:PatrickCoteContributors:KateMcGreevyJulianCritchlowbcCorporatePerformanceMeasurementApril1999Copyright©1999Bain&Company,Inc.bcCorporatePerformanceMeasurementLON2CorporatePerformanceMeasurement•ExecutiveSummary•Objectives•Background•PerformanceMeasurementFramework•MarketValueAdded(MVA)•EconomicProfit(EP)•CashFlowReturnonInvestment(CFROI)•Exercises–MVA–EconomicProfit•CaseStudy-DiageoAgendabcCorporatePerformanceMeasurementLON3CorporatePerformanceMeasurement•Corporateperformanceevaluationhasevolvedfromthe1960sfocusonROEtothecurrentvariationsofeconomicprofitthatmeasureimpactonshareholdervalue–manyfirmshavedevisedtheirownvariationsofeconomicprofit–SternStewart’sEconomicValueAdded(EVA)TMisbestknownofthesemeasures–Holt/BCG’sCashFlowReturnonInvestment(CFROI)isasimilarconceptpresentedin%returnformat•BothROEandEParebusinessmetrics,toolsusedtomeasuretheperformanceofthebusiness–separatefromfundamentalbusinessdrivers,theactualfactorsthatinfluenceshareholdervalue,andoutputmeasuresthebackward-lookingrecordsofoverallcompanyperformance•FocusingonEPinsteadofROEdecreasesthelikelihoodofdestructivebehaviorbymanagers–ByevaluatingmanagersbasedonEP,managerbehaviorcanbealteredsuchthatonlyprojectsthataddvalue(withNPV0)areundertaken,whichdoesnotalwaysoccurwithROEExecutiveSummary(1of2)bcCorporatePerformanceMeasurementLON4CorporatePerformanceMeasurementExecutiveSummary(2of2)•EndgoalofEPexercisesisconsistentwithtraditionalBainfocusofmaximisingshareholdervalue–BainhasmeasuredhistoricalperformancewithTotalShareholderReturn–SternStewartdevisedMarketValueAdded(MVA)TMasmeansofmeasuringmarketexpectationsofEPthatmanagerswilladdinthefuture–managers’objectiveshouldbetomaximiseMVA•Alleconomicprofitmeasuresdeductchargeforuseofequitycapitalfromaccounting’stypicalnetincomeorprofitaftertaxtoreflecttheopportunitycostassociatedwithequityinvestments–SternStewarthastrademarkedEVATMbyspecifyingadjustmentstomaketoEPbcCorporatePerformanceMeasurementLON5CorporatePerformanceMeasurementAgenda•ExecutiveSummary•Objectives•Background•PerformanceMeasurementFramework•MarketValueAdded(MVA)•EconomicProfit(EP)•CashFlowReturnonInvestment(CFROI)•Exercises–MVA–EconomicProfit•CaseStudy-DiageobcCorporatePerformanceMeasurementLON6CorporatePerformanceMeasurementObjectivesTherearethreeobjectivesoftheCorporatePerformanceMeasuresModule:•Todefinethemostpopularmeasuresofcorporateperformance•ToexplainthesignificanceofthesemeasuresinthecorporateenvironmentandpotentialapplicationsinBain’sstrategywork•TooutlinecalculationsofeachperformancemeasurebcCorporatePerformanceMeasurementLON7CorporatePerformanceMeasurementAgenda•ExecutiveSummary•Objectives•Background•PerformanceMeasurementFramework•MarketValueAdded(MVA)•EconomicProfit(EP)•CashFlowReturnonInvestment(CFROI)•Exercises–MVA–EconomicProfit•CaseStudy-DiageobcCorporatePerformanceMeasurementLON8CorporatePerformanceMeasurement•Withtheriseofconglomerates,mostcompaniesfocusedonReturnonEquity,orROE,astheirprimarymeasureofperformance–ledmostmanagerstoundertakeacquisitionssolelytomanipulateaccountingfigures1960s/70s1980s/90s•Withtheincreasedfocusondeliveringshareholdervalue,managershaveacceptedsystemsthatmeasurethechangeinvalue–managersrealisedequityisnotfree–economicprofit(EP)meetstheseneedsbytellingmanagerswherevaluehasbeencreatedandwhereithasbeendestroyed•Asaligninginterestsbetweenownersandmanagershasbecomemoreimportant,tyingmanagementcompensationtoEPprovidedapopularsolutionCorporateperformanceevaluationhasevolvedfromthe1960sfocusonROEtothecurrentvariationsofeconomicprofit(EP)thatmeasureimpactonshareholdervalueBackgroundCorporatePerformanceEvaluationbcCorporatePerformanceMeasurementLON9CorporatePerformanceMeasurement•Bainwasthefirstofmajorconsultingfirmstofocusoncreatingshareholdervalue•Toachievethis,BainhasusedtheoutputmeasureofTotalShareholderReturnandtheaccountingmeasuresofROEandROI•Modifiedaccountingmeasures,suchasEP,provideanalternativemeansofmeasuringthecreationofshareholdervalueBackgroundRelevancetoBainbcCorporatePerformanceMeasurementLON10CorporatePerformanceMeasurement•Toillustratetheroleofcorporateperformancemeasuresandresourceallocationtostrategywork,anexaminationofMarakon’s“program”isuseful•Marakonappliesthefollowingprogram,whichcantakeseveralyearstocomplete,toallofitsclients:–assesstheeconomicprofitofallcustomersegmentsandproductlines–comparecompanyperformancetoindustryperformance–investigatethreeormorestrategiesforeachbusinesseveryplanningcycle–shiftresourceallocationfromeconomicallyunprofitableproducts/customerstoeconomicallyprofitable–leadstoyieldlossforMarakonandclientssinceadditionalscenariosfrequentlyevaluatedMarakonhasmadeeconomicprofit(EP)thecentralfocusofthe‘program’theyapplytoeverycaseBackgroundLinktoStrategybcCorporatePerformanceMeasurementLON11CorporatePerformanceMeasurementEVAisaregisteredtrademarkofSternStewart•Acenturyago,AlfredMarshallexplainedthatforacompanytohavegenuineprofits,theprofitsmustbesufficienttocoverthecostofcapitalaswellasthefirm’soperatingcosts•SternStewarthasre-packagedtheconceptintoEVA,