This PPT slide, part of the 62-slide Corporate Strategy Toolkit PowerPoint presentation, presents a value matrix for a hypothetical company, ABC, illustrating the relationship between Return on Capital Employed (ROCE) and capital allocation across different business segments: Mail, Express, and Logistics. The vertical axis indicates ROCE, with a benchmark of 12%, while the horizontal axis represents capital employed in billions of dollars.
Each segment is depicted with a bar chart format, showing the percentage of ROCE achieved. Mail stands out with a ROCE of 30%, indicating a strong performance relative to the capital employed. In contrast, both Express and Logistics show a ROCE of only 3%, suggesting significant underperformance. The arrows and indicators suggest potential adjustments in capital allocation, highlighting the need for strategic shifts to enhance value generation.
The slide emphasizes that effective portfolio planning is directly linked to objective setting and value management. This connection is crucial for executives looking to optimize resources and drive better financial outcomes. The visual representation allows for quick assessment of where capital is yielding the best returns and where there may be opportunities for improvement.
Understanding this matrix can aid decision-makers in prioritizing investments and reallocating resources to maximize overall performance. It serves as a tool for evaluating the effectiveness of current strategies and identifying areas that require intervention. The insights derived from this analysis can be pivotal for any organization aiming to enhance its financial health and operational efficiency.
This slide is part of the Corporate Strategy Toolkit PowerPoint presentation.
This toolkit is created by trained McKinsey, BCG, and Porsche Consulting consultants and is the same used by MBB, Big 4, and Fortune 100 companies when performing Strategic Management Initiatives.
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