Doing More with Less … to Get More

-CAPITAL MANAGEMENT-
Summary   Pre Diagnosis   Instructions   Post Diagnosis

  1. Estimate your average cost of capital, or use one that is published for your company.

  2. Assume your marginal cost of capital is 70% higher than the average.

  3. Locate all of the activities, facilities, or businesses that now earn and will probably earn less than the assumed marginal cost of capital in the future.

  4. Estimate the best way to eliminate these low-return areas in order to keep profits and cash on hand as high as possible.

  5. Determine whether you are better off to reduce debt or repurchase shares with the proceeds of eliminations.

  6. Select a combination of eliminations and use of proceeds that makes the most sense for your company.

  7. Identify 25 best practices in managing capital that your company does not currently use which you could implement within 6 months, through reading the public literature on the subject.

  8. Report what you have learned.
Summary   Pre Diagnosis   Instructions   Post Diagnosis



© 1998 Mitchell and Company

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