The EVA Challenge: Implementing Value-Added Change in an Organization - Softcover

Stern, Joel M.; Shiely, John S.; Ross, Irwin

Softcover

ISBN 10: 047147889X ISBN 13: 9780471478898

Publisher: Wiley, 2003

Synopsis

The co-founder of EVA shows how to apply it in today's new economy
EVA-economic valued added-is a measure of the true financial performance of a company, and a strategy for creating corporate and shareholder wealth. It is also a method of changing corporate priorities and behavior throughout a company, right down to the "shop floor." In The EVA Challenge, the authors outline how to implement EVA-from training employees to answering the most frequently encountered implementation problems faced by companies.
This detailed "how-to" guide represents the second phase in the "EVA Revolution", showing executives around the world how to customize and implement EVA at their companies. Here, EVA converts learn how to work some "EVA magic" through company-specific initiatives and case study examples. Coverage includes completely new materials on "real options", leveraged stock options, and other concepts critical to corporations in both new and old economy industry sectors.

About this title

From the Inside Flap

-Economic Value Added-is a measure of the true economic performance of a company and a strategy for creating shareholder wealth. It is also a method of changing corporate priorities and behavior throughout a company, right down to the shop floor. Properly implemented, EVA frees the mea-surement of corporate performance from the vagaries of accounting conventions and aligns the interests of managers with those of shareholders, ending a decades-long conflict of interest.

In The EVA Challenge, authors Stern, Shiely, and Ross outline how to implement EVA at all stages-including strategy development, organizational design, training, and incentive compensation.

Essentially, an EVA program encompasses three things: a measurement system, an incentive system, and a system of financial management. In measuring performance, for example, EVA's key ingredient is the recognition of a capital charge--the cost of the capital in a company, in a division, in a branch store, or in a product. This detailed how-to guide shows executives around the world how to customize EVA for their organizations and improve the economic value they deliver. Here, EVA converts learn how to work some "EVA magic" through company-specific initiatives and case study examples. Coverage includes insightful new material on matters such as real options and new economy valuations, showing why new economy firms need EVA as much as old economy firms.

Executives around the globe now have a book that shows them how best to utilize EVA at their companies-reorienting the corporate ship in the direction of true economic profit. Research shows that companies using EVA outperformed competitors of comparable market capitalization by an average of 49% over a five-year period, as measured by total returns to shareholders.

From the Back Cover

". . . Buy it, read it on the plane and then start asking your top team some hard questions–before your shareholders do."
–– Financial Times

PRAISE FOR THE EVA CHALLENGE

"The EVA Challenge provides helpful insights for both the beginner and the advanced EVA practitioner. Its real-life examples illustrate how the practical application of shareholder value orientation can align the goals of all organizational levels, motivate management by linking compensation to EVA performance, and bring additional value to shareholders."
–– Dr. Karl-Hermann Baumann, Chairman of the Supervisory Board, Siemens A.G.

"A very valuable book for practicing managers who must solve problems. The authors provide a wealth of information and examples not only on implementing EVA, but on performance measurement and compensation in general. Their analysis is first-rate. They draw from their extensive experience and from real companies, problems, and solutions. I especially like the chapter on EVA failures."
–– Michael C. Jensen, Managing Director, Organizational Strategy Practice, The Monitor Group; Jessi Isidor Strauss Professor Emeritus, Harvard Business School

"Joel Stern knows more about creating shareholder value than anyone in America. In The EVA Challenge, you’ll learn how the master dumps rusty old accounting rules and hands managers a remarkable new yardstick for measuring success. Want to know the concept that made Roberto Goizueta great? Follow the Adam of EVA."
–– Shawn Tully, Senior Writer, Fortune

Edition details

• Publisher: Wiley
• Publication date: 2003
• ISBN 10: 047147889X
• ISBN 13: 9780471478898
• Binding: Paperback
• Language: English
• Edition number: 1
• Number of pages: 256