Measuring corporate risk and performance with SIMMETHOD predictive indices
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The document discusses SIMMETHOD, a strategy that uses predictive indices to measure corporate risk, performance, and value creation. It highlights how SIMMETHOD identifies best-in-class performers and provides alerts about risks and opportunities by comparing companies' metrics. Several charts show how best-in-class companies in 2012-2013 outperformed other companies on key financial metrics like profit margins, cash generated per employee, and value created per employee.
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Measuring corporate risk and performance with SIMMETHOD predictive indices
- 1. SIMMETHOD Strategy and Execution Performance Predictive Index The value creation power of the SIMMETHOD Best-In-Class 3/28/2014 1 WWW.SIMMETHOD.COM
- 2. The Way We Measure Corporate Performance Is Broken Why do Businesses fail? Blockbuster Borders Circuit City Mervyns Wachovia Washington Mutual Linen n’ Things 3/28/2014 2WWW.SIMMETHOD.COM
- 3. SIMMETHOD Risk and Opportunity Alerts 3/28/2014 WWW.SIMMETHOD.COM 3
- 4. SIMMETHOD Strategy and Execution Performance Predictive Index Technology, Software, Social Media, Human Resources and Business services 3/28/2014 4 WWW.SIMMETHOD.COM
- 5. SIMMETHOD Strategy and Execution Performance Predictive Index In an article dated March 27 and titled “The Mini Tech Crash Is The Biggest Story In The Market Right Now” Business Insider’s Joe Weisenthal commented: • “There’s been a lot of pain in a specific area: High beta and tech. This tweet from Sammy The Walrus captures a lot of it: We have a mini tech stock crash going on”. 3/28/2014 WWW.SIMMETHOD.COM 5
- 6. SIMMETHOD Strategy and Execution Performance Predictive Index • “AMZN at 6-month lows. Down 12% in a week. GOOG down 6% in a week • Twitter down 14% in 3 days • Others have been getting hammered as well. • Facebook is down to $59 from a high of $72. • The Social Media ETF SOCL is down over 2.5% just today and it is down 17% from recent highs”. 3/28/2014 WWW.SIMMETHOD.COM 6
- 7. Disrupting the Way We Measure Corporate Risk and Performance SIMMETHOD Tomorrow’s growth and profit hidden in today’s Strategy & Execution Performance Predictive Index 3/28/2014 WWW.SIMMETHOD.COM 7
- 8. Disrupting the Way We Measure Corporate Risk and Performance Key predictive questions: • Are your C-level risk and performance metrics and ratios based on industrial-era analytics that were not designed to capture intangible values or the dynamic industry-agnostic relationships between businesses and their value chains? 3/28/2014 8WWW.SIMMETHOD.COM
- 9. Strategy and Execution Performance Predictive Index • How to link your C-level management-decisions, resources, business processes, metrics, strategy and execution to your future risk, performance and outcomes and 3/28/2014 9 WWW.SIMMETHOD.COM
- 10. Strategy and Execution Performance Predictive Index • Compare them against the market’s Best-In-Class in order to receive early warning risk and opportunities alerts from within and outside your industry? 3/28/2014 10 WWW.SIMMETHOD.COM
- 11. The Value Creation Power of the SIMMETHOD Best-in-Class The link between a high score on the SIMMETHOD Strategy & Execution Performance Predictive Index and Best-In-Class performance 3/28/2014 11 WWW.SIMMETHOD.COM
- 12. Linking Your Management Controllable Resources to Your Risk and Performance 3/28/2014 WWW.SIMMETHOD.COM 12 -20 -10 0 10 20 30 40 50 60 NHN Visa Apple Mastercard Checkpoint Baidu Infosys Netease Google Yahoo Cognizant Priceline TataServices Cielo Intuit AOL Paychex Wipro Vmware Aggreko Accenture Experian Dassault HCL Moody's Oracle Citrix LinkedIn Microsoft Amadeus SAP H&RBlock DKSH IBM Salesforce Amazon Ebay Teradata Management Controllable Resources Index Strategy & Execution Performance Predictive Index Minimum Company Business Model Index Value Creation Index
- 13. Linking Your Management Controllable Resources to Your Risk and Performance 3/28/2014 WWW.SIMMETHOD.COM 13 -50 -40 -30 -20 -10 0 10 20 Adobe Brambles ThomasCook VeriskAnalytics EMC AutomaticData Facebook HoneywellInternational Randstad CompalElecronics HP WesternUnion QuantaComputer Alliance UnitedTechnology Innolux CA Fiserv Sodexco Tui NetApp Manpower Dell ComputerSciences FidelityNationalInformation Adecco Symantec Capgemini Atos Expedia AmericanExpress Management Controllable Resources Index Strategy & Execution Performance Predictive Index Minimum Company Business Model Index Value Creation Index
- 14. Partial Profiles of the SIMMETHOD 2012 and 2013 Best-In-Class • Partial profiles of the 2012 and 2013 Best-In- Class as selected by the Strategy and Execution Performance Predictive Index 3/28/2014 14 WWW.SIMMETHOD.COM
- 15. The Strategy and Execution Performance Predictive Index High score index = reduced risk and Best- In-Class performance Low score index = increased risk and below average performance 3/28/2014 15 WWW.SIMMETHOD.COM
- 16. The Value Creation Power of the SIMMETHOD 2012 Best-In-Class Best-In-Class create $2.9 of value for each $1 of assets Laggards create $0.90 of value for each $1 of assets 3/28/2014 16 WWW.SIMMETHOD.COM
- 17. The Value Creation Power of the SIMMETHOD 2013 Best-In-Class Best-In-Class create $2.5 of value for each $1 of assets Laggards create $1 of value for each $1 of assets 3/28/2014 17 WWW.SIMMETHOD.COM
- 18. SIMMETHOD’s 2013 Best-In-Class $1 of cash generates $24 of value 3/28/2014 18 WWW.SIMMETHOD.COM
- 19. SIMMETHOD’s 2013 Bottom 50% $1 of cash generates $12 of value 3/28/2014 19 WWW.SIMMETHOD.COM
- 20. SIMMETHOD’s 2013 Best-In-Class $1 of overheads generates $1.3 of profits 3/28/2014 20 WWW.SIMMETHOD.COM
- 21. SIMMETHOD’s 2013 Bottom 50% $1 of overheads generates $0.60 of profits 3/28/2014 21 WWW.SIMMETHOD.COM
- 22. SIMMETHOD’s 2012 Best-in-Class and Laggards’ Index Cash generated by each employee = $275K Cash generated by each employee = $47K 3/28/2014 22 WWW.SIMMETHOD.COM
- 23. SIMMETHOD’s 2013 Best-In-Class Cash generated by each employee = $271K 3/28/2014 23 WWW.SIMMETHOD.COM
- 24. SIMMETHOD’s 2013 Bottom 50% Cash generated by each employee = $162K 3/28/2014 24 WWW.SIMMETHOD.COM
- 25. SIMMETHOD’s 2013 Best-In-Class Overheads needed to support each employee = $108K 3/28/2014 25 WWW.SIMMETHOD.COM
- 26. SIMMETHOD’s 2013 Bottom 50% Overheads needed to support each employee = $119K 3/28/2014 26 WWW.SIMMETHOD.COM
- 27. SIMMETHOD’s 2012 Best-in-Class and Laggards’ Index Profit generated by each employee = $147K Profit generated by each employee = $24K 3/28/2014 27 WWW.SIMMETHOD.COM
- 28. SIMMETHOD’s 2013 Best-In-Class Profit created by each employee = $115K 3/28/2014 28 WWW.SIMMETHOD.COM
- 29. SIMMETHOD’s 2013 Bottom 50% Profit created by each employee = $27K 3/28/2014 29 WWW.SIMMETHOD.COM
- 30. SIMMETHOD’s 2012 Best-in-Class and Laggards’ Index Value created by each employee = $2.8M Value created by each employee = $420K 3/28/2014 30 WWW.SIMMETHOD.COM
- 31. SIMMETHOD’s 2013 Best-In-Class Value created by each employee = $2.4M 3/28/2014 31 WWW.SIMMETHOD.COM
- 32. SIMMETHOD’s 2013 Bottom 50% Value created by each employee = $990K 3/28/2014 32 WWW.SIMMETHOD.COM
- 33. SIMMETHOD’s 2013 Best-In-Class Profit margin 24% 3/28/2014 33 WWW.SIMMETHOD.COM
- 34. SIMMETHOD’s 2013 Bottom 50% Profit margin 8% 3/28/2014 34 WWW.SIMMETHOD.COM
- 35. C-Level Strategy & Execution Performance Predictive Index and Risk Alerts • When the Best-In-Class and your SIMMETHOD C-Level indices are moving in opposite directions, your ability to compete weakens in proportion to your widening gap to the Best-In-Class 3/28/2014 WWW.SIMMETHOD.COM 35
- 36. SIMMETHOD Risk and Opportunities Alerts The SIMMETHOD algorithms review business data and stockholders valuation-decisions across business sectors and build industry- agnostic indices in order to: • Identify, measure, correlate and predict your strengths, weaknesses, risks and opportunities against your current and potential future competitors from inside or outside your industry. 3/28/2014 36 WWW.SIMMETHOD.COM
- 37. SIMMETHOD 2014 Industry and Business Trends • SIMMETHOD’s Strategy & Execution Performance Predictive Indices and trends are not deterministic. Businesses that acted on their SIMMETHOD leading indicators and risk alerts will improve their 2014 performance as will be shown in the forthcoming update of the SIMMETHOD database, performance predictive indices and correlations. 3/28/2014 WWW.SIMMETHOD.COM 37
- 38. SIMMETHOD Risk and Opportunities Alerts SIMMETHOD is in the top 1% of most viewed in Slideshare and has been “Hot” on LinkedIn, Twitter and Facebook 47 times. 3/28/2014 WWW.SIMMETHOD.COM 38
- 39. Jorge Oscar Tabacman jtabacman@gmail.com Twitter ID: SIMMETHOD SIMMETHOD A New Way to Measure and Predict the Risk and Performance of Your Business and Alert You of New Threats and Opportunities 3/28/2014 39WWW.SIMMETHOD.COM