Financial Performance Measurement for the 21st Century Harvard Case Solution & Analysis

In this article, the writers - both of McKinsey & Company - propose a daring notion: that organizations everywhere should fully redesign their internal financial performance measurements for the digital age. The time has come, they claim, for organizations to take measure of the real engines of wealth creation in the 21st century: standings, relationships, the knowledge and other 'intangibles' created by talented folks.

Companies create wealth by convert these raw intangibles into networks, patents, brands, software, customer bases, intellectual capital and the institutional skills that raise profits per worker and returns on invested capital. The writers reveal how intangibles are accurate 'capital' in the sense that they create actual cash yields, and a business can get started in the changing of its systems to reflect the reality of modern wealth creation. The article is a passage from the authors' book, Marshalling Thoughts: Creating Wealth from Gift in the 21st Century Organization (McGraw-Hill, 2007).


This is just an excerpt. This case is about FINANCE & ACCOUNTING

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Financial Performance Measurement for the 21st Century

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