The Art of Profitability
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An extraordinarily new business slant on how companies can generate greater profits. Presented in 23 compact lessons, "The Art of Profitability" features an ongoing tutorial between two fictitious individuals.
continued. He leaned back in his chair and gazed at the ceiling thoughtfully, wanting to call up the story in all its details. “Have you heard of them?” “An investment bank, right?” “That’s right. A small but very successful boutique ﬁrm peopled by brilliantly innovative folks—rocket scientists, as they’re called. Terry ﬁt in great from day one. She was a maniac with an enormous appetite for hard labor and a great deal of self-conﬁdence. “Terry spent her ﬁrst year at Waterstone’s doing basic
they’d go to her sister’s engagement party on Friday night. There was no way he could pull this off. No way. His mind started scrambling in full damage-control mode. He’d have to think of something. Soon. 12 Brand Proﬁt January 11. Steve looked bleary-eyed. “Up late?” Zhao inquired. “Till 3:30 A.M.” Zhao pursed his lips, inwardly smiling but externally impassive. “Did you read Ezra Pound?” Zhao asked. Steve sighed. He’d forgotten about the reading assignment until that very morning—a
projects. The high-value projects were poorly structured and formulated. The least-valuable ones had been allowed to generate costs for far too long. “I helped Ann draft a set of memos to the project leaders of this ﬁrst batch of highest-value and lower-value projects. Ann asked very detailed questions. She cleared her calendar for a month to work through the problem projects. “Within two months, she discontinued a dozen projects and upped the resources for the top ten. But this was only a
time integrating their product into the customer’s systems. During this process, Factset’s revenues were tiny and their costs were huge. If you looked at a monthly P&L for a particular account, you’d see they were losing a ton of money. Costs of $10,000 might be charged against revenues of $3,000.” Zhao grabbed his yellow pad and pointed to the simple drawing he’d made. “See these lines?” he asked Steve. “These are two axes and a breakeven line.” “So the axes,” Steve mused, “must represent
don’t see where it’ll end.” Zhao pondered Steve’s words in silence for a moment. Then he said, “It’s an interesting case. Have you spoken with Frank about it since our ﬁrst class?” “No, but we’re due to have lunch next Wednesday.” “I wonder whether Frank would agree with you that Delmore’s telecom business ought to consider moving to a Customer Solution model.” “I don’t know. I’d love to talk about it with him.” “I think you should,” Zhao remarked. “Meanwhile, let’s leave behind the