2.2
SMART ASSET MANAGEMENT
Introduction
Businesses buy and build assets to secure a future return, investing today to generate profits tomorrow. This raises two fundamental issues. What happens if firms don't invest sufficiently in their asset base? Even though their short-term performance may look excellent, their long-term sustainability is at risk. This is “stealing from the balance sheet”. If they continue with this behaviour, they will reach a point where they can no longer afford to repair their damaged asset base and then they will fail. Companies committed to smart asset management identify the assets critical to long-term success and nurture them whatever the short-term challenges.
The second issue created by up-front investments is ...
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