Are you wasting time on poor performers?
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It is common for executives to devote more managerial attention, and in many cases, more financial capital, to fixing poor-performing businesses while they often assume, as a CFO recently said that “the stronger businesses will take care of themselves.”
Gregory Milano in his article in CFO.com “ Are you wasting time on poor performers?” asks whether shareholder value is being maximised when the corporate office devotes a higher proportion of management time and/or capital to turning around poor-performing business units? Or would shareholders be better served by exiting losers and focusing executive effort on nurturing, investing in and growing the value of the winners?
And if the philosophy of cutting your losses applies to investments, does the same logic apply to brands, products, projects, joint ventures, production and distribution centres and capital intensive causes?
Gregory V Milano is the co-founder and CEO of Fortuna Advisors LLC, a value-based strategic advisory company.
Please click here to view a copy of his full article.
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