Earnings Before Interest & Tax (EBIT) Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• What is the impact of wastage, productivity, cultural investments in knowledge, collaboration, and other intangibles on earnings before interest and tax (EBIT)?
• How do you assess this within any part of the business?
• How do you assess this on an activity-by-activity basis?

Solution:

• Using international intangible standards we financially estimate the loss in EBIT on an activity-by-activity basis within the business.
• For example, below:
o 8,409 is being lost in EBIT due to wastage in travel overheads (motion according to six sigma methodologies).
o Red rows are related to six sigma initiatives and this can be used to determine the financial value of six sigma initiatives.
o Knowledge management activities primarily focused on improving knowledge productivity could result in a .2m increase in EBIT.
o Structural overheads are costing .14m in EBIT




Can you currently show the impact of performance improvements on EBIT related to any activity and performance improvement project? You can now.

Financial Analyst Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• How do I show the contribution of a specific project on return on equity, return on assets, return on investment, and other financial analyst orientated information?
• How do I show how intangible value (the major drivers of share price) changes in line with a specific performance improvement?
• How can I value the financial benefit of a project all the way to earnings per share, price to earnings ratio, revenue per share and other metrics?

Solution:

• Using international intangible standards we visually flow chart complex financial relationships so that they can be easily seen and understood by non-financial staff.
• Projects can be assessed in a wide variety of ways and numerous return on investments calculated such as Revenue ROI (the return of revenue to project investment), Cost ROI (cost savings to project investment), EBIT ROI (earnings before interest and tax compared to investment), Shareholder Income ROI, etc.
• For example, if all performance improvements within the business were captured wages as a percent of revenue would decrease 18.9%, EBIT ROI would be 918%, share price would increase from .84 to .78 and earnings per share from {NEWSBODY}.84 to .78. All other projects within the business would seek to gain a share of these total benefits.



Can you currently show the impact of performance improvements on share price, earnings per share, return on assets, return on equity, cost effectiveness, wage costs, revenue, and earnings on a project by project basis? You can now.

Communication of Value Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• Busy executives, managers, and employees need information quickly with little or no complexity attached. How do I provide easily understood information that can be used to track progress on performance improvements in a way that is applicable to all divisions, departments, and units and easy enough for anyone to use?

Solution:

• Using international intangible standards we summarise key data into visual graphs and diagrams that are relevant on a departmental, divisional, unit, organizational, and workgroup level.
• As everyone can share a personalized, but consistent view, different areas of the business can be easily compared, tracked, and their performance assessed.





Can you currently show the contribution and value of each unit of your business towards revenue, cost, earnings, market value, share price, cost effectiveness, knowledge value, collaboration value, leverage, and absenteeism related issues in easily understood graphical format? You can now.

Share Price Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• How much more could your share price be if you achieved the intrinsic value of your firm?
• What is the financial contribution of knowledge and collaboration to share price?
• What share price improvements, on an activity by activity basis are associated with implementing current projects to convert wasted time into increased productivity and revenue?

Solution:

• Using international intangible standards we assess the impact of leadership (the balance of engagement and disengagement on an activity by activity basis) on share price.
• We estimate the immediately attainable (attainable organic value) of your share price that could arise by communicating the financial value of performance initiatives to analysts and investors.
• For example below we assess that the current share price of .84 is 27% below its organic value of .78.
• We see that the business is losing .51 from its share price due to ineffective leverage, .43 from its share price in terms of ineffective knowledge; .66 from its share price in terms of ineffective collaboration, and .34 from structural problems (absenteeism, etc).



Can you financially value the impact of leadership excellence on share price on an activity-by-activity basis? Can you determine how internal performance improvement projects can capture this value? You can now.

Market Value Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• How much market value is being lost due to wasted time, ineffective work practices, and working hard but not smart?
• What is the value of performance improvement projects on market value and share price?

Solution:

• Using international intangible standards, we financially estimate the association between market value, operational excellence (engagement), and wastage (disengagement). We estimate the potential market improvements that could arise by communicating the financial value of performance initiatives to analysts and investors.
• For example below we assess that:
o Ineffective leverage activities are costing the business .6m in market value each year.
o Ineffective storing and filing of information is costing the business m in lost market value each year.
o That absenteeism, accidents, sick leave, other leave (etc) is costing the business m in lost market value each year.





Can you financially value the likely impact of operational wastage on market value on an activity-by-activity basis? You can now.

Revenue Loss Challenges


The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• What are the revenue losses associated with lost time, ineffective work practices, and working hard but not smart?
• How much extra revenue could be possible if the organization had higher levels of intangible intelligence and had more effective intangible management practices?

Solution:

• Knowing time losses and cost wastage is not enough.
• Using international intangible standards, revenue losses associated with wasted time and cost is also determined.
• For example below we assess that:
o Reading and learning wastage across the organization is resulting in a loss of .15m in revenue per annum.
o Sick leave costs .84m, absenteeism, .94m, email .22m and internal politics 0,000 in lost revenue.
o That the business is putting .34m in revenue “at risk” and making that value available to competitors due to ineffective intangible management practices.





Can you currently financially value the likely impact of operational wastage on revenue on an activity-by-activity basis? You can now.

Disengagement & Leadership Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• What are the wage costs associated with disengagement associated with knowledge, collaboration, leverage, operational, structural, and organizational activities?
• How much artificial employment could occur by working smarter, not harder and what is the financial value in terms of avoided wage costs?

Solution:

• The screen shot below show a company with 250 full time equivalent (FTE) staff. The analysis below shows that:
o A total of 66.6 FTEs are lost due to organizational disengagement
o Only 183.4 of the 250 FTE staff are actually working.
o The business is wasting m in wages as it is getting no productive benefit from this expenditure.
• A failure to manage human capital in this way causes employee stress, customer stress, and financial stress. This stress then impacts earnings, market value, and share price – all of which decrease shareholder returns.
• The system can track the strategic impact of different competitive strategies on engagement and assess leadership effectiveness.




Can you currently determine how many equivalent full-time employees (FTEs) are being paid for zero value contribution due to disengagement? You can now.

Disengagement Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• How disengaged are staff?
• How do you quantify disengagement so that it can be measured and managed?
• How do you measure knowledge disengagement – the costs of deficient, ineffective, and ‘working hard but not smart’ knowledge activities?
• How do you measure collaboration disengagement – the costs of deficient, ineffective, and ‘working hard but not smart’ collaboration activities?
• How do you measure leverage disengagement – the costs of deficient, ineffective, and ‘working hard but not smart’ operational activities?
• How do you determine as a percentage of time across the organization, or within a department, unit, or workgroup?

Solution:

• Disengagement causes financial stress and employees and customers to leave. Below you can see that:
o There is 8.2% knowledge disengagement – which is causing a loss of 39,794 hours of time related to knowledge issues
o There is 5.6% collaboration disengagement (27,106 hours).
o Overall, the business is losing 26.7% of its time due to disengagement




Can you currently determine the exact extent of risk associated with ineffective value drivers related to knowledge, collaboration, leverage, and absenteeism? You can now.

Customer Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• How much time are customers really demanding from the organization?
• Should you remove employees through downsizing, or grow the business?
• What revenue, earnings, and shareholder returns are lost when your organization cannot satisfy customer demand? How can working smarter create time savings to capture currently untapped, under-serviced, or un-serviced customer demand?

Solution:

• Quantifying how much time is required to meet customer demand and determine the effectiveness of time investments inside and outside your organization is a mission critical requirement today.
• We determine if your organization is meeting customer demand and the impact of customer loss and market risk. Below you can see:
o The organization is generating its revenue in 357,293 hours, but has 528,100 hours of customer demand.
o It is wasting 129,842 hours internally and this time, when saved, can be used to satisfy existing customer demand, retain more customers, and organically increase growth.
o A total of 129,842 hours of wasted time could be converted into increased productivity and earnings all without hiring an additional employee (artificial employment).



Can you currently determine how much time customers really demand from your organization and if you should upsize, downsize, or engage in artificial employment? You can now.

Time Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• What time is being wasted on meetings, email, internal politics, red tape, rework/errors, email, printing, reading/learning, phone calls, meetings, interruptions, and a wide range of other operational issues?
• What time wastage is associated within absenteeism, sick leave, industrial action, accidents, and other structural overheads?
• What time can be saved by reducing this wastage in terms of cost reduction, revenue improvement, earnings and shareholder returns, market value and share price improvement?
• What time is being invested in the culture of the organization? Is this time investment too high, or too low?

Solution:

• We identify where time savings can be transformed into increased revenue without paying additional wage costs (called “artificial employment”). Artificial employment converts ineffective costs into effective costs thereby increasing cost effectiveness.
• Below we see that over 129,000 hours are being wasted internally. Specifically:
o 24,692 hours are being wasted due to ineffective internal structures
o 39,794 hours are being wasted due to ineffective knowledge activities
o 27,106 hours are being wasted due to ineffective collaboration
o 38,250 hours are being wasted due to absenteeism related activities.



Can you currently scientifically determine wasted time, cultural time investment, and actual productivity at any level of business operation? You can now.

Expense Challenges

The Global Cost to Value Taskforce will provide new web-based systems to address key challenges such as:

• What expenses and costs are being wasted on meetings, email, internal politics, red tape, rework/errors, printing, reading/learning, phone calls, interruptions, and a wide range of other operational issues?
• What are the costs associated within absenteeism, sick leave, industrial action, accidents, and other structural overheads?
• What is the value of reducing this wastage in terms of time savings, revenue improvement, earnings and shareholder returns, market value and share price?
• What is the organization’s current level of cost effectiveness?
• How much money is literally being “thrown away” due to working hard, but not working smart?
• What costs are being invested in the culture of the organization?

Solution:

• Professional qualified Intangible Intelligence Analysts use their practical knowledge to collect data in accordance with international intangible standards
• Below the business is operating at 73.35% cost effectiveness. Specifically it is:
o Wasting .42m in expenses from ineffective reading/learning
o Wasting .14m in expenses on meetings, wasting over 0,000 on internal politics, wasting over m on absenteeism, sick leave, etc.




Can you currently financially value expense wastage at any level of business operation for any activity within the business? You can now.

Taskforce Objectives

Wasting costs and wasting time decreases shareholder returns and creates revenue/growth opportunities for rivals. Today, the majority of wasted costs, wasted time, lost revenue, depressed earnings and shareholder value are the direct result of ineffective or inefficient knowledge (finding information, reading, etc), collaboration (phone calls, meetings, etc), leverage (errors, rework, travel, etc), or structural activities (absenteeism, sick leave, etc).

The Intangible Intelligence Cost to Value Taskforce is creating cutting-edge web-based infrastructures to measure this wastage on an activity-by-activity basis so that executives can find new ways to cut costs, increase revenue, and boost market value and share price.

Through the deployment of web-based systems with inbuilt scenario analysis, it is now possible to financially value and financially report:

1. Cost Wastage
2. Lost Revenue
3. Shareholder value losses
4. Ineffective activities
5. Employee Disengagement
6. Employee Stress & Engagement
7. Leadership Effectiveness
8. Performance Improvement Potential
9. Knowledge Value
10. Collaboration Value
11. Leverage Value
12. Project Value
13. Employee productivity


The above can be done within any division, unit, department, or workgroup of your organization, in terms of:

1. Wage Costs
2. Non-Wage Expenses
3. Revenue
4. Total Costs
5. Earnings
6. Shareholder returns
7. Market value
8. Intangible value
9. Share price
10. Earnings per share
11. Return on assets
12. Return on equity
13. Return on investment
14. Price to Earnings Ratio
15. Return on intangibles
16. and more


Mission Critical Issues: Real Benefits

Due to ineffective and inefficient knowledge, collaboration, leverage, and structural activities, it is possible that your organization could be wasting up to 25% of its costs each year. That is, could amount to a substantial amount of wastage that is 100% avoidable.

The first step in avoiding this cost wastage is to know that this wastage is occurring – each and every day of the year, across all divisions and units in your organization. The Taskforce’s web-based infrastructures, formed in accordance with international intangible standards, executives can uncover cost, revenue, earnings, market value, and share price wastage and financially value and report it.

Imagine the competitive impacts.

If your competitors can identify the financial losses of wastage related to cost, revenue, time, earnings, market value, and share price and your organization cannot, your organization is at a serious competitive disadvantage:

• Whilst you are working hard, they will be working smart.
• Whilst you are wasting time and costs, they will not.
• They will gain the customers you lose.
• They will be using their existing workforce smarter and more effectively than yours.
• Over time, this will translate into them winning, and you losing.

Can your organization afford this? By joining the Taskforce as a pilot participant you gain pre-market access to these systems and can reap benefits before your competitors do.


Gaining Taskforce Benefits

To become a taskforce member, please join this website.

Taskforce Objectives

The Intangible Intelligence Global Cost to Value Taskforce is seeking to bring the financial reporting and financial valuation of intangibles into the 21st century through the application of international intangible standards. The Tasforce will provide new reporting infrastructures to financially determine:

1. Cost Wastage - Determines what wages and other costs are wasted due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.

2. Time Wastage - Determines what time is wasted due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.

3. Revenue Loss - Determines what revenue is lost due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.

4. Earnings Loss - Determines what earnings is lost due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.

5. Market Value Loss - Determines what market value is lost due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.

6. Share Price Loss - Determines what share price is lost due to ineffective or inefficient knowledge, collaboration, leverage, and structural activities.