Profitability analysis
Strategic avenues to superior performance
Value creation and value capture
Analyzing a firm’s profitability can reveal its strategy—and how well it’s working. View the article: https://stephen-l-jones.github.io/articles/profitability-analysis. (01:57) Profitability as return on invested capital (14:00) Benchmarking ROIC (16:11) Going deeper: Return on sales and capital turnover (20:53) Going even deeper: Expense, asset, and unit-based ratios (26:21) Analyzing profitability
Five strategic avenues lead to superior performance, each using a different economic logic. View the article: https://stephen-l-jones.github.io/articles/strategic-avenues-to-superior-performance. (00:37) Value composition (05:56) Pricing avenue (12:01) Value-creation avenue (16:30) Efficiency avenue (20:34) Market-expansion avenue (26:09) Rivalry-reduction avenue (29:53) Choosing an avenue
Winning firms create and capture value using economic fundamentals. View the article: https://stephen-l-jones.github.io/articles/value-creation-and-value-capture. (00:28) Industries (04:05) Customer demand and firm profit (12:47) Value creation (18:06) Value capture
Strategic management theories explain why firms achieve superior performance, with each theory offering unique insight. View the article: https://stephen-l-jones.github.io/articles/a-survey-of-strategy-theory. (03:12) Industry view (06:30) Resource-based view (15:51) Applying strategy theory