Future value drivers
A computer-implemented method for analyzing corporate investments to measure the performance of a company is provided. The method may include: receiving financial data, the financial data including a plurality of operating investments of the company and a Future Value (FV) of the company; determining with a data processor a plurality of data points from the financial data, each of the plurality of data points indicative of a ratio between one of the plurality of operating investments and the Future Value (FV) of the company; determining a first benchmark and a second benchmark, the first benchmark indicative of a threshold ratio between the FV and the operating investment, the second benchmark indicative of a threshold operating investment; and displaying the data points, the first benchmark, and the second benchmark to advise a user of an effectiveness of the operating investments.
1. A computer-implemented method of measuring the performance of a company by analyzing corporate operating investments, the method comprising:
receiving financial data, into a memory coupled to a data processor, the financial data including a plurality of operating investments of the company and a Future Value (FV) of the company;
determining, with the data processor that executes instructions in the memory, a plurality of data points from the financial data, wherein each of the plurality of data points includes a ratio between the Future Value (FV) of the company and one of the plurality of operating investments;
determining, with the instructions, a first benchmark and a second benchmark, wherein the first benchmark is a threshold ratio between the FV of the company and the operating investment, wherein the second benchmark is a threshold operating investment, the first benchmark and the second benchmark defining an intersection on a graph; and
displaying, in a graphical display coupled to the data processor, the data points, the first benchmark, and the second benchmark on said graph, where the graph is divided into four quadrants: the upper left quadrant indicating small operating investments that are earning a high FV return on investment (ROI), the bottom left quadrant indicating small operating investments having a low FV ROI, the bottom right quadrant indicating large operating investments that provide a low FV ROI, and the upper right quadrant indicating large operating investments that provide a high FV ROI;
determining an effectiveness of the operating investments based on the location of the plurality of data points with respect to the quadrants.
2. The computer-implemented method of claim 1 , wherein the plurality of operating investments are investments into business units of the company.
3. The computer-implemented method of claim 2 , wherein the business units are subsidiaries of the company.
4. The computer-implemented method of claim 1 , wherein the financial data includes a plurality of operating investments of a second company and a Future Value (FV) of the second company,
wherein the determining further includes determining, with a data processor, a plurality of additional data points from the financial data, each of the plurality of additional data points is a ratio between the Future Value (FV) of the second company and one of the plurality of operating investments of the second company, wherein the displaying further includes displaying the additional data points.
5. The computer-implemented method of claim 1 , wherein the FV of the company identifies a market expectation of the future value of the company.
6. The computer-implemented method of claim 1 , wherein at least one of the plurality of operating investments identifies a company asset that drives at least one of group consisting of volume, price, product mix, customer retention, brand equity and the breadth/depth of the company's product portfolio, advertising, training costs, management talent considerations, intellectual capital, technology investments, and capital flexibility.
7. The computer-implemented method of claim 1 , wherein the first benchmark and second bench mark identify a tax-credit comprising a tax savings of investments into business units of the company.
8. The computer-implemented method of claim 1 , wherein the first benchmark identifies a FV multiple and the second benchmark identifies investments into business units of the company multiplied by the FV multiple.
9. The computer-implemented method of claim 7 , wherein the first benchmark identifies a FV multiple and the second benchmark identifies investments into business units of the company multiplied by the FV multiple.
10. The computer-implemented method of claim 1 , wherein the FV comprises:
a revenue component that defines an expected dollar amount of future sales,
a costs component that defines an expected dollar amount of future costs,
a capital component that defines an expected future capital structure of the company, and
a FV driver component that is a value associated with a company asset that drives at least one of group consisting of the revenue component, the costs component, and the capital component, the FV driver component including an associated FV driver value.