What M&A Banker Would Rather I Not Write

How do M&A dealmakers cajole or coerce tough-minded, market-hardened CEOs to shell out top dollar, sometimes paying more for the business than it was “really worth”? What are the techniques? the tricks? Here’s what M&A bankers do to you.

12 CEO Diseases and How to Treat Them

Some of the “diseases” that CEOs catch may seem minor; these can be the virulent ones that morph stealthily into major corporate illnesses. Following are some CEO diseases and prescriptions for treating them.

Pay For Performance: Beating “Best Practices”

We conducted empirical research on the way various compensation structures work for or against shareholder value creation. We looked at S&P 500 executive compensation plan data, supplemented by conversations with hundreds of executives and consultants. Against this standard, the evidence indicates that certain practices prove out favorably; some with plausible rationales have questionable value, at best, and some are clearly counter productive.

New Deans, New Directions

Business school deans once cloistered themselves in ivy-covered towers within serene university settings, isolated from real world pressures. But no longer. Today, the top job at the world’s top schools presents challenges akin to those faced by corporate CEOs. Competition among schools has intensified, international curriculum and campuses are now de rigeur, and faculty recruitment and retention is more challenging. The demands of these new … [ Read more ]

Marc Hodak

Most boards believe that rewarding managers through stock options is an effective incentive leading to long term shareholder value. Equity ownership, by definition, aligns managers and shareholders. But effective incentive implies a motivation to do something, as opposed to a simple desire to see the share price go up. Most senior executives, right up to the CEO, will tell you that movement in the stock … [ Read more ]

Jeff Heilman

Going by the numbers alone can be misleading, meaningless or downright hazardous -there are banana skins galore in financial statements “tidied up” for earnings season. One-time charges, for instance, while properly used to take nonrecurring expenses that do not materially affect company value off the balance sheet, can hide unfavorable expenses, bad debt or poor investments. Easy to calculate, the venerable valuation standard P/E ratio-market … [ Read more ]

Dr. Robert Lawrence Kuhn

It is astounding how many “dumb” questions, well timed, might have prevented poor decisions.

Why CEOs Shouldn’t Fear a Green Agenda

Building more efficient equipment is actually an important key to profitability says George David, chief executive of United Technologies.

Peter Skarzynski

Two large companies that join together are typically so focused on market domination or operational integration that they have no time to think about strategic innovation. Instead of creating entirely new business models, post-merger supersized companies prefer to use their new bulk to coast on the fumes of past glory and brand name. Mergers of equals often turn out to be mergers of the equally … [ Read more ]

Brian Murray

If you listen to your existing customers, a disruptive innovation can come along…which the customers are behind the curve on. They don’t know what new markets could be coming down the road. So you need to have two sets of antennae out there: one listening to your customers, but the other looking at what is completely disruptive that even your customers may not be attuned … [ Read more ]

Should The Top Roles Be Split?

The Brits say yes. But in the U.S., executives believe no one single model fits all companies.

B-School Advantage

Top schools are letting CEOs tailor programs to get the most bang for their buck.

Steven B. Potter (CEO, Executive Search Division, TMP Worldwide)

Companies also fail to realize that the really talented people don’t fear turnover. What drives them out is the toleration of mediocrity. If you tolerate mediocrity in your organization and then claim to be the best, I can tell you right now you’re not. And if you look at those who are the best at what they do, their turnover rates are generally somewhat lower. … [ Read more ]

Doing Diversity

The question isn’t why to do it-but how. Here are a few savvy strategies that really work.

Supply Chain Alchemy

Bargaining clout and technology are no longer the only keys to supply chain bliss.

The China Riddle

To survive, smaller U.S. manufacturers will have to export. Therein lies a dilemma.

Warren Buffett

[When hiring] I look for character, intelligence and work ethic. And if I screw up on the first one, I pray they’re dumb and lazy.

What Lurks Ahead?

CEOs swept up by “China euphoria” could one day be surprised.

The Three Capitals of China

The strength of China’s markets is pulling some Asian headquarters away from Tokyo and Singapore, but which of China’s “three capitals” makes the most sense – Hong Kong, Beijing or Shanghai? The answer, it appears, is that each has strengths and weaknesses, and chief executives making decisions about where to set up shop need to understand those and factor in the nature of their own … [ Read more ]