Executive Briefings

Great Opportunity Lies in These Uncertain Times

Writers and broadcasters go on and on about the increasing uncertainty of the times, and all this uncertainty is generally couched as threatening. This foreshadowing is astonishing when you consider that boundless opportunities for big-win investments can lurk within uncertainty -- uncertain yes, but with huge upside potential nonetheless. What causes firms and managers to generally regard uncertainty as a negative, when in fact opportunities for unusual prosperity lie in being able to exploit that very uncertainty? As you look into the reasons why managers do not forge prosperity out of uncertain investments, you see that it is really not their fault! Managers have not been given the right tools for investing in uncertain times. They are in the grips of a "Go/No Go vise," using tools for investment analysis that were created for more stable times. Discounted cash flow calculations and net present value analysis have them fixated on "making their numbers" or being treated as failures. These blinkers keep them locked into a Go/No Go decision-making pattern, either proceeding full steam ahead or stopping in their tracks (which, in the face of uncertainty, is usually No Go), when in fact they could be engineering the risk out of uncertain opportunities and going for high potential wins by slicing out their downside and boosting their upside.

Read Full Article

Writers and broadcasters go on and on about the increasing uncertainty of the times, and all this uncertainty is generally couched as threatening. This foreshadowing is astonishing when you consider that boundless opportunities for big-win investments can lurk within uncertainty -- uncertain yes, but with huge upside potential nonetheless. What causes firms and managers to generally regard uncertainty as a negative, when in fact opportunities for unusual prosperity lie in being able to exploit that very uncertainty? As you look into the reasons why managers do not forge prosperity out of uncertain investments, you see that it is really not their fault! Managers have not been given the right tools for investing in uncertain times. They are in the grips of a "Go/No Go vise," using tools for investment analysis that were created for more stable times. Discounted cash flow calculations and net present value analysis have them fixated on "making their numbers" or being treated as failures. These blinkers keep them locked into a Go/No Go decision-making pattern, either proceeding full steam ahead or stopping in their tracks (which, in the face of uncertainty, is usually No Go), when in fact they could be engineering the risk out of uncertain opportunities and going for high potential wins by slicing out their downside and boosting their upside.

Read Full Article