Total return to shareholder analytics

• US 7,349,877 B2
• Filed: 03/02/2005
• Issued: 03/25/2008
• Est. Priority Date: 03/02/2004
• Status: Active Grant

• Current Assignee: Accenture Global Services Limited (Accenture PLC)
• Original Assignee: Accenture Global Services GmbH (Accenture PLC)
• Inventors: Ballow, John J., McCarthy, Brian F., Relvas, Anthony J.
• Primary Examiner(s): Kazimi; Hani M.
• Assistant Examiner(s): Havan; Thu Thao
• Application Number:
  US11/072,354
• Publication Number:
  US 20050209948A1
• Time in Patent Office: 1,119 Days
• Field of Search: 705/7, 705/11, 705 35- 36, 705/36.R, 705/37
• US Class Current: 705/36.00R
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 10/06375 Prediction of business process outcome or impact based on a proposed change
• CPC Class Codes: G06Q 10/0639 Performance analysis of employees; Performance analysis of enterprise or organisation operations
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A computer-implemented method for analyzing the relative performance of a business unit includes: receiving financial data about the business unit; determining NOPLAT, revenue, capital charge, and invested capital values for the business unit at a first time and a second time from the financial data; determining at least two data points including a first component indicative of NOPLAT/revenue and a second component indicative of revenue/capital charge for the business unit, the at least two data points indicative of values determined at one of the first time and the second time, respectively; and displaying the at least two data points, a first indicia for each data point indicative of the capital value, a second indicia indicative of a spread percentage, and a third indicia indicative of a relationship between the at least two data points between the first time and the second time.

Claims

1. A system for analyzing the financial performance of a business unit of a company, the system comprising:

a database having a means for receiving, storing and retrieving financial data about a first business unit and a second business unit different from the first business unit, and having a communications interface for receiving and transferring financial data about the first business unit and the second business unit;

means for determining Net Operating Profit Less Adjusted Taxes (NOPLAT), revenue, capital charge, spread percentage, and invested capital values for each of the first business unit and the second business unit at least at a first time and a second time from the financial data;

means for determining at least two data points for the first business unit and the second business unit, respectively, based on the NOPLAT, revenue, capital charge, spread percentage, and invested capital values, each data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the at least two data points indicative of values determined at one of the first time and the second time, for the first business unit and the second business unit, respectively;

means for forecasting the NOPLAT, revenue, capital charge, and invested capital values for the first business unit for a third time, said third time being subsequent to said first time and said second time;

means for determining a third data point for the first business unit based on the forecasted values, the third data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the third data point indicative of determined values forecasted for the third time;

at least one display area comprising;

a user interactive and numerical data display area for receiving a user input and displaying numerical data, wherein the user input comprises commands to input, delete, modify and retrieve financial data from the database, and to select the first business unit and the second business unit;

a graphical display area for graphically displaying the financial performance of the first business unit and the second business unit comprising;

right, left, top and bottom regions;

right, left, top and bottom edges that define the border of the graphical display area;

a vertical axis with a bottom end and a top end corresponding to a low to a high percentage of profitability values from, bottom to top, the profitability values represented by NOPLAT divided by revenue, the vertical axis positioned in the left region of the graphical display area to the right of the left edge of the graphical display area;

a horizontal axis with a left end and a right end corresponding to a low to a high capital utilization values from left to right, the capital utilization values represented by revenue divided by capital charge, the horizontal axis positioned to intersect at the left end of the horizontal axis with the vertical axis at the point along the vertical axis representing the percentage of profitability value of zero;

wherein the top end of the vertical axis ends before the top edge of the graphical display area, wherein the bottom end of the vertical axis ends before the bottom edge of the graphical display area, wherein the right end of the horizontal axis ends before the right edge of the graphical display area,

wherein the vertical axis and the horizontal axis define a boundary of a plot area; and

a legend area outside the plot area;

wherein the plot area comprises;

at least two circles representing the first data point for the first time and the second data point for the second time for each of the first business unit and the second business unit, respectively, wherein the at least two circles are positioned in the plot area to visually indicate the NOPLAT divided by revenue, revenue divided by capital charge, and spread percentage values for the first data point and the second data point for each of the first business unit and the second business unit, respectively, wherein the size of the at least two circles is indicative of the invested capital of the first business unit and the second business unit, respectively, wherein the at least two circles have a unique color or pattern to distinguish the first time from the second time, and wherein a trend line is drawn between the center of the at least two circles for each of the first business unit and the second business unit, respectively;

a third circle for the first business unit representing the third data point for the third time, wherein the third circle is positioned in the plot area to visually indicate the forecasted NOPLAT divided by revenue, revenue divided by capital charge, and spread percentage values for the first business unit, wherein the size of the third circle is indicative of the invested capital of the first business unit, wherein the third circle has a unique color or pattern to distinguish the third time from the first time and the second time; and

a plurality of isoquant lines indicative of spread percentage values, wherein the plurality of isoquant lines are positioned in the foreground of the plot area, and the at least two circles and trend lines for the first business unit and the second business unit, respectively, and the third circle for the first business unit are positioned in the background of the plot area.

2. The system of claim 1, wherein the display area is responsive to a user input to modify a forecasted value to cause a visually observed movement of the third data point to a new position depicting a result of the change in the forecasted value.

3. The system of claim 1, wherein the means to receive a user input to modify a forecasted value includes active arrows that increase or decrease the forecasted value, and substantially immediately thereafter graphically display the resulting change of the third data point in the plot area.

4. The system of claim 1, wherein thc plot area further comprises labels positioned proximate to the at least two circles and the third circle indicative of the identity of each of the first business unit and the second business unit, respectively.

5. The system of claim 1, further comprising means for receiving an operator input indicative of a growth percentage for at least one value selected from the group consisting of the revenue, NOPLAT divided by revenue, capital charge, and a capital expenditures values for the first business unit or the second business unit for the third time in the future in accordance with the operator input.

6. The system of claim 1, further comprising:

means for forecasting the NOPLAT, revenue, capital charge, and invested capital values for the first business unit for a fourth time, the fourth time being subsequent to the third time;

means for determining a fourth data point for the first business unit from the forecasted values, the fourth data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the fourth data point indicative of forecasted values for the fourth time;

the plot area further comprising a fourth circle for the first business unit indicative of the fourth data point for the fourth time, and a trend line connecting a center of the third circle to a center of the fourth circle.

7. The system of claim 1, wherein the user interactive and numerical data display area further comprises a navigation tool including a plurality of activatable buttons labeled with identities of business units configured to cause updating the display area with information associated with, the business unit upon activation of a selected button.

8. The system of claim 1, further comprising means for determining the first business unit and the second business unit by a business unit type selected from the group consisting of a company, a product line, a geographical region, a Stock Keeping Unit (SKU), a competitor company, a competitor product line, a competitor geographical region, or a competitor'"'"'s SKU.

9. A system for analyzing the financial performance of a business unit of a company, the system comprising:

a database having a means for receiving, storing and retrieving financial data about a first business unit and a second business unit different from the first business unit, and having a communications interface for receiving and transferring financial data about the first business unit and the second business unit said third time being subsequent to said first time and said second time;

means for determining spread percentage, future value, and invested capital values for each of the first business unit and the second business unit at least at a first time and a second time from the financial data;

means for determining at least two data points for the first business unit and the second business unit, respectively, based on the spread percentage, future value, and invested capital values, each data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the at least two data points indicative of values determined at one of the first time and the second time, for the first business unit and the second business unit, respectively;

means for forecasting the spread percentage, future value, and invested capital values for the first business unit for a third time, said third time being subsequent to said first time and said second time;

means for determining a third data point for the first business unit based on the forecasted values, the third data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the third data point indicative of determined values forecasted for the third time;

at least one display area comprising;

a user interactive and numerical data display area for receiving a user input and displaying numerical data, wherein the user input comprises commands to input, delete, modify and retrieve financial data from the database, and to select the first business unit and the second business unit;

a graphical display area for graphically displaying the financial performance of the first business unit and the second business unit comprising;

right, left, top and bottom regions;

right, left, top and bottom edges that define the border of the graphical display area;

a vertical axis with a bottom end and a top end corresponding to a low to a high spread percentage values from bottom to top, the vertical axis positioned in the left region of the graphical display area to the right of the left edge of the graphical display area;

a horizontal axis with a left end and a right end corresponding to a low to a high future value efficiency values from left to right, the future value efficiency values represented by future value divided by invested capital, the horizontal axis positioned to intersect at the left end of the horizontal axis with the vertical axis at the point along the vertical axis represented by the spread percentage value of zero;

wherein the top end of the vertical axis ends before the top edge of the graphical display area, wherein the bottom end of the vertical axis ends before the bottom edge of the graphical display area, wherein the right end of the horizontal axis ends before the right edge of the graphical display area;

wherein the vertical axis and the horizontal axis define a boundary of a plot area; and

a legend area outside the plot area;

wherein the plot area comprises;

at least two circles representing the first data point for the first time and the second data point for the second time for each of the first business unit and the second business unit, respectively, wherein the at least two circles are positioned in the plot area to visually indicate the spread percentage, future value divided by invested capital values for the first data point and the second data point for each of the first business unit and the second business unit, respectively, wherein the size of the at least two circles is indicative of the invested capital of the first business unit and the second business unit, respectively, wherein the at least two circles have a unique color or pattern to distinguish the first time from the second time, and wherein a trend line is drawn, between the center of the at least two circles for the first business unit and the second business unit, respectively; and

a third circle for the first business unit representing the third data point for the third time, wherein the third circle is positioned in the plot area to visually indicate the forecasted spread percentage and future value divided by invested capital values for the first business unit, wherein the size of the third circle is indicative of the invested capital of the first business unit, wherein the third circle has a unique color or pattern to distinguish the third time from the first time and the second time.

10. The system of claim 9, wherein the display area is responsive to a user input to modify a forecasted value to cause a visually observed movement of the third data point to a new position depicting a result of the change in the forecasted value.

11. The system of claim 9, wherein the means to receive a user input to modify a forecasted value includes active arrows that increase or decrease the forecasted value, and substantially immediately thereafter graphically display the resulting change of the third data point in the plot area.

12. The system of claim 9, further comprising means to determine an Enterprise Value (EV) of the business unit by subtracting excess cash from a value of market equity plus market debt of the business unit, to determine a current value (CV) of the business unit by dividing the NOPLAT value by a Weighted Average Cost of Capital (WACC) value, wherein the future value is determined by EV minus CV.

13. The system of claim 9, wherein the plot area further comprises labels positioned proximate to the at least two circles and the third circle indicative of the identity of each of the first business unit and the second business unit, respectively.

14. The system of claim 9, further comprising means for receiving an operator input indicative of a growth percentage for at least one value selected from the group consisting of the revenue, NOPLAT divided by revenue, capital charge, and a capital expenditures values for the first business unit or the second business unit for the third time in the future in accordance with the operator input.

15. The system of claim 9, wherein the user interactive and numerical data display area further comprises a navigation tool including a plurality of activatable buttons labeled with identities of business units configured to cause updating the display area with information associated with the business unit upon activation of a selected button.

16. The system of claim 9, further comprising:

means for forecasting the spread percentage, future value, and invested capital values for the first business unit for a fourth time, the fourth time being subsequent to the third time;

means for determining a fourth data point for the first business unit from the forecasted values, the fourth data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the fourth data point indicative of forecasted values for the fourth time;

the plot area further comprising a fourth circle for the first business unit indicative of the fourth data point for the fourth time, and a trend line connecting a center of the third circle to a center of the fourth circle.

17. A system for analyzing the financial performance of a business unit of a company, the system comprising:

a database having a means for receiving, storing and retrieving financial data about a first business unit and a second business unit different from the first business unit, and having a communications interface for receiving and transferring financial data about the first business unit and the second business unit;

means for determining NOPLAT, revenue, capital charge, spread percentage, invested capital and future value values for each of the first business unit and the second business unit at least at a first time and a second time from the financial data;

means for determining at least two profitability data points for the first business unit and the second business unit, respectively, based on the NOPLAT, revenue, capital charge, spread percentage, and invested capital values, each data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the at least two profitability data points indicative of values determined at one of the first time and the second time, for the business unit and the second business unit, respectively;

means for determining at least two operating advantage data points for the first business unit and the second business unit, respectively, based on the spread percentage, future value, and invested capital values, each data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the at least two data points indicative of values determined at one of the first time and the second time, for the first business unit and the second business unit, respectively;

means for forecasting the NOPLAT, revenue, capital charge, future value, spread percentage and invested capital values for the first business unit for a third time, said third time being subsequent to said first time and said second time;

means for determining a third profitability data point for the first business unit based on the forecasted values, the third data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the third data point indicative of determined values forecasted for the third time;

means for determining a third operating advantage data point for the first business unit based on the forecasted values, the third data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the third data point indicative of determined values forecasted for the third time;

at least one display area on a user interface comprising;

a user interactive and numerical, data display area for receiving a user input and displaying numerical data, wherein the user input comprises commands to input, delete, modify and retrieve financial data from the database, and to select the first business unit and the second business unit;

a graphical display area for graphically displaying the financial performance of the business unit comprising;

right, left, top and bottom regions;

right, left, top and bottom edges that define the border of the graphical display area;

a first plot area and a second plot area within the display area;

wherein the first plot area comprises;

a vertical axis with a bottom end and a top end corresponding to a low to a high percentage of profitability values from bottom to top, the profitability values represented by NOPLAT divided by revenue, the vertical axis positioned in the left region of the graphical display area to the right of the left edge of the graphical display area;

a horizontal axis with a left end and a right end corresponding to a low to a high capital utilization values from left to right, flue capital utilization values represented by revenue divided by capital charge, the horizontal axis positioned to intersect at the left end of the horizontal axis with the vertical axis at the point along the vertical axis representing the percentage of profitability value of zero;

at least two circles representing of the first profitability data point for the first time and the second profitability data point for the second time for each of the first business unit and the second business unit, respectively, wherein the at least two circles are positioned in the plot area to visually indicate the NOPLAT divided by revenue, revenue divided by capital charge, and spread percentage values for the first data point and the second data point for each of the first business unit and the second business unit, respectively, wherein the size of the at least two circles is indicative of the invested capital of the first business unit and the second business unit, respectively, wherein the at least two circles have a unique color or pattern to distinguish the first time from the second time, and wherein a trend line is drawn between the center of the at least two circles for each of the first business unit and the second business unit, respectively;

a third circle for the first business unit representing the third profitability data point for the third time, wherein the third circle is positioned in the plot area to visually indicate the forecasted NOPLAT divided by revenue, revenue divided by capital charge, and spread percentage values for the first business unit, wherein the size of the third circle is indicative of the invested capital of the first business unit, and wherein the third circle has a unique color or pattern to distinguish the third time from the first time and the second time; and

a plurality of isoquant lines indicative of spread percentage values, wherein the plurality of isoquant lines are positioned in the foreground of the plot area, and the at least two circles and trend lines for the first business unit and the second business unit, respectively, and the third circle for the first business unit are positioned in the background of the plot area;

wherein the second plot area comprises;

a vertical axis with a bottom end and a top end corresponding to a low to a high spread percentage values from bottom to top, the vertical axis positioned in the left region of the graphical display area to the right of the left edge of the graphical display area;

a horizontal axis with a left end and a right end corresponding to a low to a high future value efficiency values from left to right, the future value efficiency values represented by future value divided by invested capital, the horizontal axis positioned to intersect at the left end of the horizontal axis with the vertical axis at the point along the vertical axis representing the spread percentage value of zero;

at least two circles representing the first operating advantage data point for the first time and the second operating advantage data point for the second time for each of the first business unit and the second business unit, respectively, wherein the at least two circles are positioned in the plot area to visually indicate the spread percentage, future value divided by invested capital values for the first data point and the second data point for each of the first business unit and the second business unit, respectively, wherein the size of the at least two circles is indicative of the invested capital of the first business unit and the second business unit, respectively, wherein the at least two circles have a unique color or pattern to distinguish the first time from the second time, and wherein a trend line is drawn between the center of the at least two circles for the first business unit and the second business unit, respectively; and

a third circle for the first business unit representing a third operating advantage data point for the third time, wherein the third circle is positioned in the plot area to visually indicate the forecasted spread percentage and future value divided by invested capital values for the first business unit, wherein the size of the third circle is indicative of the invested capital of the first business unit, and wherein the third circle has a unique color or pattern to distinguish the third time from the first time and the second time.

18. The system of claim 17, further comprising means to determine an Enterprise Value (EV) of the business unit by subtracting excess cash from a value of market equity plus market debt of the business unit, to determine a current value (CV) of the business unit by dividing the NOPLAT value by a Weighted Average Cost of Capital (WACC) value, wherein the future value is determined by EV minus CV.

19. The system of claim 17, wherein the means to receive a user input to modify a forecasted value includes active arrows that increase or decrease the forecasted value, and substantially immediately thereafter graphically display the resulting change of the third profitability data point in the first plot area and the third operating advantage data point in the second plot area.

20. The system of claim 17, wherein the first plot area further comprises labels positioned proximate to the at least two circles and the third circle indicative of the identity of each of the first business unit and the second business unit, respectively;

and

wherein the second plot area further comprises labels positioned proximate to the at least two circles and the third circle indicative of the identity of each of the first business unit and the second business unit, respectively.

21. The system of claim 17, further comprising:

means for forecasting the NOPLAT, revenue, capital charge, future value, spread percentage, and invested capital values for the first business unit for a fourth time, the fourth time being subsequent to the third time;

means for determining a fourth profitability data point for the first business unit from the forecasted values, the fourth profitability data point including a first component indicative of NOPLAT divided by revenue, a second component indicative of revenue divided by capital charge, and a third component indicative of invested capital, the fourth profitability data point indicative of forecasted values for the fourth time;

means for determining a fourth operating advantage data point for the first business unit from the forecasted values, the fourth operating advantage data point including a first component indicative of spread percentage, a second component indicative of future value divided by invested capital, and a third component indicative of invested capital, the fourth operating advantage data point indicative of forecasted values for the fourth time;

the first plot area further comprising a fourth circle for the first business unit indicative of the fourth profitability data point for the fourth time, and a trend line connecting a center of the third circle to a center of the fourth circle for the profitability data points; and

the second plot area further comprising a fourth circle for the first business unit indicative of the fourth operating advantage data point for the fourth time, and a trend line connecting a center of the third circle to a center of the fourth circle for the operating advantage data points.

22. The system of claim 17, wherein the user interactive and numerical data display area further comprises a navigation tool including a plurality of activatable buttons labeled with identities of business units configured to cause updating the display area with information associated with the business unit upon activation of a selected button.

23. The system of claim 17, further comprising means for receiving an operator input indicative of a growth percentage for at least one value selected from the group consisting of the revenue, NOPLAT divided by revenue, capital charge, and a capital expenditures values for the first business unit or the second business unit for the third time in the future in accordance with the operator input.

24. The system of claim 17, further comprising a means to update the calculated ratios and performance metrics upon receipt of a changed value in an input field and substantially immediately thereafter graph the new data points reflective of the updated ratios and performance metrics.

25. The system of claim 17, further comprising means for determining the first business unit and the second business unit by a business unit type selected from the group consisting of a company, a product line, a geographical region, a Stock Keeping Unit (SKU), a competitor company, a competitor product line, a competitor geographical region, or a competitor'"'"'s SKU.