Further, Rappaport presents provocative new insights on shareholder value of his business classic, Creating Shareholder Value, Alfred Rappaport. It’s become fashionable to blame the pursuit of shareholder value for the ills besetting corporate America: managers and investors obsessed with next quarter’s. VBM Thought Leader: Alfred Rappaport. Creating Shareholder Value. The New Standard for Business Performance. Alfred Rappaport About Alfred Rappaport.

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Shareholders are not the frequently demonized wealthy, self-serving Wall Street caricatures, but instead are largely individuals who invest human capital in their place of employment and financial capital across a broad cross section of the economy.

Michael joined CS in as a packaged food industry analyst. The question here is whether these measures are linked reliably to the market price of the company’s shares.

Customers demand high-quality products and services at competitive prices. After all, it is productivity that will provide the jobs and the tax base needed for the accomplishment of social goals that are more effectively addressed by government than by the private sector.

Alfred Rappaport – Creating Shareholder Value

Even the most sharehplder advocate of shareholder value understands that without customer value there can be no shareholder value. The third factor affecting management behavior is the threat of takeover by another company. This lower price, relative to what it might be with more efficient management, offers an attractive takeover opportunity for another company, which in many cases will replace incumbent management.

After a decade of downsizings frequently blamed on shareholder value decision making, this book presents a new and indepth assessment of the rationale for shareholder value.


These factors derive from the fundamental premise that the greater the expected unfavorable consequences to the manager who decreases the wealth of shareholders, the less likely it is that the manager will, in fact, act against the interests of shareholders. In this substantially revised and updated edition of his business classic, Creating Shafeholder Value, Alfred Rappaport provides managers and investors with the practical tools needed to generate superior returns.

However, the critical role of the shareholder vallue approach in allocating resources in a market-based economy is far from universally accepted. Primarily as a response to significant employee layoffs, “balancing the interests of stakeholders” has commanded increasing attention in the s.

Steve McBride rated it it was ok Aug 25, This shareholdfr with market forces has led to less competitive, high-cost companies and unemployment rates more than twice those experienced in this country.

We have a number of suppliers, institutions, customers, and communities. Suppliers and bondholders seek payment when their financial claims fall due. Wallace’s quality program significantly increased on-time deliveries as well as its market share. Just a moment while we sign you in to your Goodreads account. Corporate management, however, has neither the political legitimacy nor the expertise to decide what is in the social interest.

This led to the infamous “value gap,” i. In the early s there were very few companies with an unambiguous commitment to shareholder value. Every serious ananlyst should have a firm understanding of his writings.

Further, Rappaport presents provocative new insights on shareholder shraeholder applications to: Managements governed by shareholder interests would invest in technology, training, or reengineered workplaces that reduce safety costs. Get a FREE e-book by joining our mailing list today! Free eBook offer available to NEW subscribers only. Not all downsizing is based on long-term shareholder value considerations.


In this substantially revised and updated edition of his business classic, Creating Shareholder Value, Alfred Rappaport provides managers and investors with the practical tools needed to generate superior returns. In light of these developments, a reassessment of the valye rationale for the shareholder value approach is warranted. Siro Gutierrez rated it it was amazing Jul 30, The argument is that because employees are now also shareholders who will benefit from efficiency-enhancing plant closings and layoffs, they would support these value-creating actions.

Creating Shareholder Value

Suppliers enjoy the prospect of additional business, and the local community gets a larger tax base resulting from the increased size of the company. The proportion of stock required in compensation packages to align employee interests with those of shareholders is in most instances simply not feasible. No eBook available Amazon. What’s on the horizon? Managers, like other people, act in their self-interest. Some of these jobs are in fact materializing in the very same companies that had eliminated other jobs during an earlier restructuring.

The source of the problem here is not the use of the shareholder value approach. The distinction Rappaport makes between shareholder return and corporate return is particularly critical in today’s markets.