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Uncontrolled growth can damage your enterprise (Management Wizards beware)

It is a reality than in a global environment a company needs presence and representation in the worldwide market; today many medium sized companies all over the world are struggling to be competitive and restructuring their financial management strategies.

Modern financial managers coming from big schools keep modifying and creating structural entities within the companies, costs centers, etc, forgetting completely that at the end of the day it won’t really matters if your money is in your left or right pocket as long as the pocket containing your money belongs to you…

Companies can grow as the result of successful increase in activity due to marketing efforts or service quality, as well as the result of external acquisitions, whatever the reason for growth it will have as a consequence an increased number of overhead expenditures that can overcome the added revenue benefit (Marginal cost concept)

In recent years I had the opportunity to witness how a strategy change in a company in the hands of financial geniuses turned into a commercial handicap thus killing all the potential benefits of the strategies… (But putting a bucketload of money on the Managing directors and the board) Continue Reading →