11/2/2022 0 Comments Eye of the beholder quote![]() What is your value proposition to your customers and are they willing to pay a premium for it? For example, some customers may demand a high level of safety in the services you provide. For customers, value means what you can do for them. Like employees, businesses need customers to operate. The community sees value in companies that follow the law, employ community members, are socially engaged and are environmentally responsible. What this means always comes down to doing the right thing. "Being a good corporate citizen" is a phrase we hear often in business. Employees see "value" in their companies when these requirements are delivered, which at times may conflict with owners' short-term return expectations.Īll companies exist within a community, which, in turn, demands certain things. ![]() However, what most employees want from an organization is stability, the ability to do engaging work, a positive work environment and positive feedback loops. ![]() Usually, shareholders attempt to align their financial goals with those of employees by offering stock options or employee ownership in the company. It is impossible to run a business without employees. EYE OF THE BEHOLDER QUOTE FREEValue could, therefore, be defined as earning the highest return on invested capital, generating higher and predictable profitability, generating free cash flow and ultimately driving the intrinsic equity value per share as high as possible. In a larger business, the board of directors has a fiduciary duty to increase value for the shareholders and value is almost always defined in financial terms. ![]() In owner-managed businesses, the main shareholder runs the business, so his/her expectations may all be related to driving personal profit.
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