EBITDA. Is it misleading?

In the majority of distressed companies I’ve worked on, the two most important measures of financial performance are not reviewed – Operating Income (EBIT) and Free Cash Flow. Instead EBITDA, Gross Profit and Net Income are the only profit measures included on the Income Statements. Operating Income is a superior measure of an operating company’s […]

Peter Drucker’s Tenets

Peter Drucker, a writer of 39 books and a management consultant, was considered the “father of modern management”. An avid student of managing complex businesses, he was the advisor who helped mold many corporations into industry leaders which forged this country’s ability to become an economic super power. A Sampling of Mr. Drucker’s Tenets: “In […]

Mexico vs. China. Which is the Better Plant Location?

The question of whether Mexico is a better place to manufacture a product versus China seems to come up frequently.  A recent Los Angeles Times article combined with my experiences in closing a USA plant and building a new plant in Shanghai are the sources for the following: Since 2000, the 3,700 Mexican Maquiladoras have […]

What Leads to Business Failure?

Donald Keough’s book “The Ten Commandments for Business Failure”is an interesting, creditable book useful to Chief Executive Officers with a company culture that needs improvement. Donald Keough is the former President of The Coca-Cola Company. The book is a short, easy read that covers all the elements of a positive culture. Some of it is self-evident. […]

Can Manufacturing Return to the USA?

The need to move USA manufacturing operations to competitive economic climates, has been essential for a Company’s survival.  This exodus to a number of foreign countries, mainly to China and Mexico, has had a negative impact on the USA – its economy, median incomes, standards of living. Today, New Balance Inc. is a rather unique […]

China to surpass USA as World Leader in manufacturing?

The headline in a June 2010 Financial Times article was bothersome. It chronicled “US Manufacturing Crown Slips”. In summary, the article reported: “The US remained the world’s biggest manufacturing nation by output last year, but is poised to relinquish this slot in 2011 to China – thus ending a 110-year run as the number one country […]

Where is China Heading?

Mark Leonard’s book “What Does China Think?” presents China’s challenges and struggles with some surprising priorities its leaders have set to correct them. For the first time in China’s history its 11th five-year plan does not list economic growth as its first priority. The plan: “put people first”…“respecting the natural environment”…introduces a Scandinavian model of social welfare […]

The GM & Chrysler Bankruptcies

“The General Motors Corp. Chapter 11 bankruptcy marks the humbling of an American icon that once dominated the global car industry and sets up a high-stakes gamble for USA taxpayers.” Reportedly both General Motors and Chrysler will exit from Chapter 11 Bankruptcy Court in 60 to 90 days. This sounds like wishful thinking and may […]

Why William Clay Ford, Jr. Failed

In October 2006, the Ford Motor Company replaced William Clay Ford, Jr. as its Chief Executive Officer. Why did Mr. Ford fail? His own words, reported by Micheline Maynard of the New York Times on July 16, 2006, titled “Is Ford Running On Empty” revealed the answer. “I bowed to managers on what I knew […]

India – What hinders its development?

Some thoughts on the interesting book “In Spite of the Gods – The Strange Rise of Modern India” by Edward Luce, the former Financial Times’ Washington Bureau Chief. He was the FTs’ South Asia Bureau Chief based in New Delhi. While his conclusion is that India will become an economic super power, its many negatives will […]