Competing Forces: Profitability And Growth (2 Of 5)

How to Become Financially World Class, Part 2

In this five-part video series Andrew Stotz, PhD, CFA walks you through all the basics you need to know about World Class Benchmarking and How to Make Your Company Financially World Class.

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We know that business is hard, but we believe that the financial aspects should NOT be. World Class Benchmarking is a clear-cut financial tool for that takes the finances of your company from complicated to simple, from scattered to focused, and from individual to team.

Questions I wanted to answer for my own business

  • How do you increase the value of your business?
  • What is most important for your business…high profitability or fast growth?
  • How can you be sure that what you measure matters most for the value of your business?

Competing forces: Profitability and Growth

Opposite forces can be complementary like in y?nyáng. Extremely high Profitability (Yin) reduces growth. Extremely high Growth (Yang) reduces profitability.

It is hard for a business to maintain the opposing forces of profitability and growth at maximum. If both forces are weak the business dies.

World Class Benchmarking measures a combination of profitability and growth which we call “Profitable Growth”. The Profitable Growth score explains how well a company maximizes and balances the two forces.

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