Study: Shareholder Return Tied To Better Cash Flow, Other Improvements

Jan. 13, 2005
A study just released by the Boston Consulting Group (BCG) says that managers can most effectively increase shareholder value by improving the company's cash-flow margin, improving the productivity of the company's assets, or growing investments. The ...

A study just released by the Boston Consulting Group (BCG) says that managers can most effectively increase shareholder value by improving the company's cash-flow margin, improving the productivity of the company's assets, or growing investments. The study, The Value Creators: A Study of the World's Top Performers, suggests that managers can improve cash-flow margins by better cost-management or pricing strategy. They also can improve asset productivity by deploying resources more efficiently -- for example, by improving inventory management or using fixed assets more effectively. In addition, they can focus on growth in investment by transferring core competencies to new businesses or expanding into new markets, effectively creating new assets. BCG's study measured total shareholder returns (TSR) of more than 5,300 companies, which together account for some 80% of the total capitalization of the world's stock markets, from the end of 1993 to the end of 1998. Dell Computer Corp. was the leader in shareholder return, with an average annual TSR of 153%. In second place was America Online with 143%. SAP AG was third with a 91% average.

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Shifting Your Business from Products to Service-Based Business Models: Generating Predictable Revenues

Oct. 27, 2023
Executive summary on a recent IndustryWeek-hosted webinar sponsored by SAP

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!