Analysts keep getting it wrong

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Equity Analysts: Still Too Bullish in McKQ makes depressing, if unsurprising reading. Analysts continue a decades-long tendency to forecast nearly double the profit growth that actually follows, and go most wrong when they most need to get it right – when boom times falter. CEOs get beaten over the head with these forecasts, and mess up business in their efforts to hit stupid targets, so this is of more than academic interest. It is interesting to note, then, that ...

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Mintzberg’s destruction of Strategy

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Mintzberg’s keynote role at a conference on the MBA is a worry, but his latest foray into strategy is too serious to let pass. In Management by Reflection in S+B he continues his age-old mantra that teaching MBAs to work stuff out is pointless if not dangerous. He once sneeringly noted that MBA really stands for ‘Master in Business Analysis’. Well, he got his wish – working stuff out is now largely absent from MBA programs, especially in Strategy classes, ...

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Cost reduction and strategy

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No surprise I suppose that many companies took the shock of the down-turn to focus on cost-cutting. In What worked in cost cutting—and what’s next? McKinsey’s report of a global survey offers mixed news – yes, plenty of costs were cut, but executives worry about sustaining those cuts and about continuing risks from the sluggish economy. What we don’t know – and probably never will – is the consequences. How many, for example, cut too much, in the wrong ...

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