64 Posts found for Author: Tim Koller

The economic principles of valuation don’t change that much, but McKinsey Partner Tim Koller explains why they remain more critical than ever as executives seek to address digital, geopolitical, climate, and other trends affecting their businesses.

Content: Article | Authors: Roberta Fusaro, Tim Koller | Source: McKinsey Quarterly | Subjects: Economics, Finance

In a divestiture, companies must overcome the complexities of disentanglement.

Content: Article | Authors: Anna Mattsson, Jamie Koenig, Tim Koller | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions

Daniel Kahneman was the psychologist whose findings helped launch behavioral economics. The encouraging words he shared with me offer good news for organizations.

Content: Article | Authors: Daniel Kahneman, Tim Koller | Source: McKinsey Quarterly | Subject: Organizational Behavior

Psychologists have identified more than 60 cognitive biases that affect how people make decisions. We boiled them down into four groups: group think; confirmation bias; loss aversion, which leads us to put more weight on losses than gains; and anchoring or inertia—anchoring decisions in what we did in the past.

Content: Quotation | Author: Tim Koller | Source: McKinsey Quarterly | Subjects: Decision Making, Organizational Behavior

Public companies are often not set up for innovation, partly because their compensation systems tend to be short-term-oriented and because the boards aren’t deeply enough involved in innovation. […] We’ve seen a tremendous amount of innovation in the past 20 years, but a lot of it has come from younger, newer companies. Despite all the talent, capital, and customer knowl­edge established corporations have, there … [ Read more ]

Content: Quotation | Author: Tim Koller | Source: McKinsey Quarterly | Subject: Innovation

Many perceive the markets as short-term oriented, forcing management to worry only about quarterly earnings. Our research shows that successful companies are typically those with longer-term horizons. There are plenty of investors who have long-term horizons as well, but they generally need to talk to a company only once or twice a year to make their decisions. Short-term investors are noisier. They probably drive the … [ Read more ]

Content: Quotation | Author: Tim Koller | Source: McKinsey Quarterly | Subjects: Economics, Finance

Value creation comes from revenue growth and return on capital, which drive cash flows.

Content: Quotation | Author: Tim Koller | Source: McKinsey Quarterly | Subject: Finance

The most effective resource allocation processes are radically simple.

Content: Article | Authors: Tim Koller, Zuzanna Kraszewska | Source: McKinsey Quarterly | Subject: Finance

It’s hard for companies to significantly beat long-term market TSR, harder still for the largest corporations, and hardest of all in the face of low growth. But industry endowment needn’t be destiny.

Content: Article | Authors: Pedro Catarino, Rosen Kotsev, Tim Koller, Zane Williams | Source: McKinsey Quarterly | Subjects: Best Practices, Management, Strategy

McKinsey analysis of more than 2,200 large global companies reveals the importance of monitoring both economic-profit growth and revenue growth.

Content: Article | Authors: Peter Stumpner, Tim Koller, Vartika Gupta | Source: McKinsey Quarterly | Subject: Finance

[A premortem is where] at the start of a project, you imagine that the project went wrong and think about what could have caused that result. You put yourself into the future and, in a non-judgmental way, think of all the things that could derail the project. It creates a safe way for people to discuss their concerns without being perceived as criticizing the project. … [ Read more ]

Content: Quotation | Authors: Dan P. Lovallo, Tim Koller | Source: McKinsey Quarterly | Subjects: Management, Project Management

Companies create more shareholder value when executives and directors concentrate on long-term results. A new report highlights behaviors that allow them to maintain a long-term orientation.

Content: Article | Authors: Ariel Babcock, Kevin Sneader, Sarah Keohane Williamson, Tim Koller, Victoria Potter | Source: McKinsey Quarterly | Subjects: Best Practices, Management

There are many trade-offs that company managers struggle to make, in which neither a shareholder nor a stakeholder approach offers a clear path forward. This is especially true when it comes to issues affecting people who aren’t immediately involved with the company. These so-called externalities—perhaps most prominently, a company’s carbon emissions affecting parties that otherwise have no direct contact with the company—can be extremely challenging … [ Read more ]

Content: Quotation | Authors: Marc H. Goedhart, Tim Koller | Source: McKinsey Quarterly | Subjects: Management, Social Responsibility (ESG)

Getting your environmental, social, and governance (ESG) proposition right links to higher value creation. Here’s why.

Content: Article | Authors: Robin Nuttall, Tim Koller, Witold Henisz | Source: McKinsey Quarterly | Subject: Social Responsibility (ESG)

Multiple studies have indicated the degree to which business leaders are loath to kill projects. One such study developed by IESE Business School Professor Luis Huete found that companies and individuals that have had a track record of success have a harder time killing projects, because they carry with them an ingrained belief that they can turn everything into gold, so long as everyone works … [ Read more ]

Content: Quotation | Authors: Dan P. Lovallo, J. André de Barros Teixeira, Tim Koller | Source: McKinsey Quarterly | Subjects: Management, Organizational Behavior

New research shows that companies that know how to shift critical resources where and when they’re needed share common traits. Rigor is the first one.

Content: Article | Authors: Massimo Garbuio, Tim Koller, Zane Williams | Source: McKinsey Quarterly | Subjects: Finance, Management

Addressing anchoring bias can lead to more accurate budget forecasts, better budget conversations, and more dynamic resource reallocation.

Content: Multimedia Content | Authors: Dan P. Lovallo, Sean Brown, Tim Koller | Source: McKinsey Quarterly | Subjects: Finance, Management, Organizational Behavior

It may be easier than you think to debias your decisions and make better forecasts by building the “outside view.”

Content: Multimedia Content | Authors: Dan P. Lovallo, Tim Koller | Source: McKinsey Quarterly | Subjects: Decision Making, Management, Organizational Behavior

Businesses with different financial profiles can tax managers and put performance at risk. When divesting isn’t an option, here’s how to manage the conflicts.

Content: Article | Authors: Dan P. Lovallo, Tim Koller, Zane Williams | Source: McKinsey Quarterly | Subjects: Finance, Management, Strategy

Despite strong pressures to focus on the short term, it is possible to manage for the long term and reap considerable rewards.

Content: Article | Authors: James Manyika, Sree Ramaswamy, Tim Koller | Source: McKinsey Quarterly | Subjects: Best Practices, Corporate Governance, Management, Strategy