I recently read this book, "What the CEO wants you to know", which is authored by Prof Ramcharan. The sub-title of this book is "Using Business Acumen to understand how your company really works". IMHO, the sub-title is what correctly describes the content of the book though the title is the one which is more catchy!
In less than 150 pages, the author has provided time-tested advice to each one operating in the business. What I liked the most about this book is a list of eight questions that one should ask about a company to understand its total business. These eight questions are as follows:
In less than 150 pages, the author has provided time-tested advice to each one operating in the business. What I liked the most about this book is a list of eight questions that one should ask about a company to understand its total business. These eight questions are as follows:
- What were your company's sales during the last year?
- Is the company growing? Or is growth flat or declining? Is this growth picture good enough?
- What is your company's profit margin? Is it growing, declining or flat?
- How does your margin compare with your competitors? How does it compare wit those of other industries?
- Do you know your company's inventory velocity? its asset velocity?
- What is your company's return on assets? (ROA = After-tax margin * Asset Velocity)
- Is your company's cash generation increasing or decreasing? Why is it going one or the other?
- Is your company gaining or losing against the competition?
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