In brief:
In the last chapter we gave an outline of what is meant by strategic management. Now it's the turn of financial thinking. At the heart of financial thinking lies the present—value criterion — the idea of assessing the attractiveness of a project on the basis of its value. Present value also forms the basis for measuring a firm's value. The value of the firm is — assuming the intention to continue its operations as a going concern — equal to the sum of all the discounted future net cash inflows the firm generates. Financial thinking means looking for ways to increase value and taking appropriate action. Only the financial value of the future net cash inflows actually generated counts. The details of the projects — the focus of attention in strategic approaches — take a back seat.
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© 2009 Springer-Verlag Berlin Heidelberg
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(2009). Think Financially. In: Management Between Strategy and Finance. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-85275-9_5
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DOI: https://doi.org/10.1007/978-3-540-85275-9_5
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-540-85274-2
Online ISBN: 978-3-540-85275-9
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