Renaissance for LEADERS

Peak Performance Resources for Leaders by Leaders

Category: Business (Page 1 of 3)

Blame Game

Accusations exchanged between people who refuse to accept responsibility for an undesirable event, loss or failure. Finger pointing and scapegoating are common techniques used to divert attention and focus on a person who is assigned fault. Whenever money is lost, emotions run high and the Blame Game kicks into high gear.

Capitalize

1. To take advantage of. 2. To use as or convert into capital. 3. To supply with capital or investment funds. 4. To authorize the issue of a certain amount of stock. 5. To convert debt into equity. 6. To calculate the current value of future cash flows. 7. To include expenditures in business accounts as assets instead of expenses.

Cash Cow

1. A metaphor for a dairy cow that has calves annually, produces milk daily for life while requiring little maintenance. After the initial capital outlay has been paid off, the cow continues to produce milk and birth more cows that produce milk and more cows for many years. This is an example of an initial investment that grows geometrically over time. The Cash Cow Formula: 1 Cow + 1 Bull + 1 paddock + food + water = an exponential supply of cows and milk. Limited only by the supply of resources (paddock, food, and water.) 2. Products or services that have become market leaders, provide positive cash flow and a return on assets that exceeds the market growth rate. These products produce profits long after the initial investment has been repaid and help to fund company growth, leverage expansion and increase creditworthiness.

Conventional Wisdom

The ideas, explanations, and beliefs that are generally accepted as true by the general public or experts in the field. Though widely held, these ideas and pieces of advice are neither examined or validated. Many of these thought forms are no longer true (if they ever were), perpetuating them maintains the status quo.

Customer

1. The next person or entity in the business flow who receives the output of the preceding person or entity (supplier) in the form of a product, service or information. 2. A person one has to deal with. 3. Attracting customers is the primary goal of most businesses because it is the customer who creates demand for goods and services.

Dividend

A distribution of a portion of a company’s profits to the shareholders, payable in cash, stock or other property. Profits that are not distributed remain with the company as retained earnings. Start-ups and high-growth companies rarely offer dividends because their profits are reinvested to help sustain higher-than-average growth and expansion. Larger, established companies tend to issue regular dividends to maximize shareholder returns in ways aside from capital growth.

Equity

1. The state or quality of being just and fair. 2. Ownership interest in a corporation, property, or another asset, usually calculated as the value of the holding after subtracting any debt or liabilities. 3. Shares of stock. 4. The value of a brand’s reputation. 5. Representing an ownership interest: an equity stake. 6. Subordinated to all other claims on income, earnings, or assets.

Globalization

The process of worldwide interaction and integration of people, companies, and governments. For thousands of years, people have been trading with each other across long distances and in the process shared ideas, beliefs, and culture. The opening of borders, reduction of tariffs, the free movement of people, goods and capital, music, movies, combined with reduced transportation costs and technology has accelerated global integration and the export of American cultural values. English has dominated as the global language, with a global culture of entertainment, fashion and design emerging.

Licensing

Renting or leasing an intangible asset. It is a process of creating and managing contracts between the owner of the asset and a company or individual who wants to use the asset in association with a product, for an agreed period of time, within an agreed territory, for an agreed payment.

Liquidity

1. The state of being liquid. 2. The quality of being readily convertible into cash: an investment with high liquidity. 3. Available cash or the capacity to obtain it on demand. 4. The ease with which an asset can be converted into money. Cash is liquid but shares in a company are less liquid because they must be sold in order to convert them into money. Assets such as property are even less liquid because they take longer to sell than shares.

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