DESCRIPTION
Organizations engage in profit and loss (P&L) improvement gradually and continuously—typically aiming for incremental gains instead of major Transformation. On the contrary, activist investors push a troubled company to undergo radical Restructuring. This may cause major P&L Improvement, but the drastic cuts—neither well planned nor internally well accepted—can have negative impacts on the organization.
Organizations are at risk to activists' intrusion when shareholders' expectations for P&L performance is much higher than management's projections. If the P&L gap reaches around 20 to 30%, the company is at risk of being asked by shareholder activists to undergo radical restructuring.
The widened P&L gap warrants decisive action where the senior leadership can utilize the Rapid Earnings Expansion approach to eliminate its vulnerability in the hands of activist investors.
The Rapid Earnings Expansion approach can be instrumental in bridging the P&L gap. This slide deck takes a comprehensive look at the Rapid Earnings Expansion approach, its key phases, and its effectiveness in aiding to promptly close the P&L gap.
The slide deck also includes some slide templates for you to use in your own business presentations.
The Rapid Earnings Expansion approach is structured around a four-phase methodology: RESET Target, Strategy Development, Implementation, and Forecast Projection. Each phase is meticulously designed to ensure that the P&L gap is closed swiftly and effectively. The RESET phase involves setting ambitious yet achievable targets, often aiming to double EBIT within a one to two-year timeframe. Strategy Development focuses on assigning specific performance targets to solution teams, ensuring no P&L driver is overlooked. Implementation requires a pragmatic integration of multiple initiatives, while Forecast Projection keeps a close eye on capital spending, eliminating any financial ambiguities.
This slide deck also contrasts Rapid Earnings Expansion with traditional profitability improvement methods, highlighting its proactive and robust nature. Unlike conventional approaches that respond to external pressures, Rapid Earnings Expansion is self-initiated and driven by strategic imperatives. It encompasses the entire enterprise, ensuring concurrent, interdependent efforts. The included templates provide a practical framework for applying these concepts, making this PPT an invaluable resource for senior executives aiming to safeguard their organization against activist investors and achieve rapid financial turnaround.
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Source: Best Practices in Performance Management, Business Transformation, Growth Strategy PowerPoint Slides: Rapid Earnings Expansion PowerPoint (PPT) Presentation, LearnPPT Consulting
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