Harvard Business Review

JULY 2, 2014

It’s a simple calculation to determine how many units must be sold at a given price to cover one’s fixed costs. Assume she must incur a fixed cost of $25,500 to produce and sell a kite. These costs are fixed because they will not change with the number of kites sold. That’s the breakeven point.

Analysis 8

Analysis Fixed Costs Price Cost 8

Harvard Business Review

AUGUST 16, 2011

Such a strategy limits an early venture's funding in order to force the business to develop a profitable business model and then invests heavily in growth once such a model is identified — Christensen terms such investments "good money" for incubating growth businesses and extols the strategy for three reasons.

Christensen 20

Christensen Fixed Costs Metrics Business Model 20

Harvard Business Review

MARCH 28, 2011

Most companies focus on minimizing costs rather than maximizing flexibility, which would entail making large investments in supply chains. For instance, many companies feel they don't need to develop alternatives to Japanese suppliers because they buy so little from them nowadays. Variabilizing costs. to RMB 4.5

Supply Chain 15

Supply Chain Fixed Costs Price Crisis 15

Harvard Business Review

AUGUST 11, 2011

Management has made promises to senior executives about what a project will achieve, and fixed costs have built up because they looked prudent in comparison to planned revenues. Clean Magic Eraser, were breakthrough hits, but they probably cost a good deal to develop.

Innovation 15

Innovation Fixed Costs Airlines Business Model 15

Harvard Business Review

DECEMBER 21, 2011

By utilizing basic HR tools like business process redesign, organizational redesign, job redesign and competency model development, we were able to more effectively align our selling and support processes to the changing business realities of large-scale farming and construction. Not all fixed cost reductions were people.

Offshoring 15

Offshoring Fixed Costs Outsourcing Construction 15

Harvard Business Review

SEPTEMBER 4, 2013

For example, a decade ago, it''s unlikely that small-business owners would have told you that they needed a flexible way to host data and applications, one that preferably turned the fixed cost of computer hardware into a variable cost of renting capacity. Developing a breakthrough idea will never be a paint-by-numbers exercise.

Industry 8

Industry Fixed Costs Trends Innovation 8

Harvard Business Review

MARCH 16, 2017

A drug company must incur a large fixed cost to do the basic research, so it has strong incentives to predict what the demand for the drug will be if its research succeeds. and in developing nations. Air conditioning demand is soaring in the developing world. Consider the example of a new drug for curing baldness.

Entrepreneur 9

Entrepreneur Aggregate Demand Incentives Real Estate 9

Harvard Business Review

FEBRUARY 6, 2018

To the extent that the technology Amazon developed for Amazon Go can be turned to services beyond grocery shopping, health care may be one of the early beneficiaries. These executives agreed that if such issues were challenging for Amazon, they surely must plague smaller internet companies that are in an earlier stage of their development.

Health Care 11

Health Care Retail Operations Insurance 11

Harvard Business Review

JULY 27, 2017

And the fixed cost from “touchpoint-to-pilot” are immense. For example, in the case of a $100 million CVC fund, which can close five to 10 investments a year, these costs typically range from $1 to $2 million per startup — not including the administrative and variable costs of the pilot itself.

Venture Capitalist 8

Venture Capitalist Meyer Innovation Fixed Costs 8

Harvard Business Review

MAY 19, 2015

As the technology develops, GE could revamp this and other plants into general printer farms supplying all of its manufacturing divisions. That gave it a steadier cash flow to cover the costs of its large fixed cost investments, but did not eliminate the unused capacity of plants dedicated to one kind of product.

Engineering 8

Engineering Learning Curve Fixed Costs Finance 8

Harvard Business Review

DECEMBER 17, 2014

Eden McCallum, thus, manages to keep its overhead and other fixed costs at a minimum. The only thing the consultants (usually ex-McKinsey, Bain, or BCG) are responsible for is to execute these projects to the best of their abilities. And that is exactly what many consultants like doing.

McCallum 13

McCallum Competitive Advantage McKinsey Consultative 13

Harvard Business Review

JULY 22, 2011

To appreciate the truth of this claim, it's vital to understand one of Clayton Christensen's theories on marketing and product development: Jobs-to-be-done. It was in your home, had no shelf space limiting its inventory, and could beat Tower on price because of its lower fixed costs.

Christensen 16

Christensen Disruptive Innovation Price Business Model 16

Harvard Business Review

OCTOBER 27, 2016

A full-time job provided the steady income needed to support our traditional version of the American Dream: the highly leveraged, high-fixed-cost house; the cars; the latest consumer goods. If you had a full-time job, you won. These skilled and entrepreneurial workers win in the gig economy by moving from good jobs to great work.

Disaggregation 8

Disaggregation Insurance Retail Fixed Costs 8

Harvard Business Review

OCTOBER 5, 2017

It could be because “software development typically requires large upfront fixed costs,” meaning that firms that are already pretty large are the ones who can afford to invest in it. But why is IT leading to winner-take-all competition?

Document 9

Document Industry Software Fixed Costs 9

Harvard Business Review

MAY 28, 2018

Directly influenced by investor input, Nikon developed a restructuring plan that would carry a onetime cost of ¥48 billion ($460 million) but generate ¥20 billion ($190 million) in annual savings.

Company 9

Company ROIC CFO Restructuring 9

Harvard Business Review

DECEMBER 1, 2017

These spending choices require tradeoffs, so entrepreneurs must first develop a strategy for allocating limited resources across a wide range of available options. So not only were the current fees too weak to support his fixed costs, but future clients were turned off by his apparently excessive tastes.

Strategy 10

Strategy Budgeting Cost Price 10

Harvard Business Review

MAY 21, 2015

The costly and complex operations of transporting energy have made utilities natural monopolies, while regulatory barriers and the high fixed costs of building and maintaining regional electrical grid infrastructure have also kept much competition at bay.

Energy 8

Energy Transportation Software Price 8

Harvard Business Review

MARCH 18, 2013

We didn't want to burden the organization with fixed costs. Almost everything had to be free, and the few things we paid for had to be scalable so that the unit costs would eventually approach zero. Software development" and "hardware" are bad words. This removed the biggest bottleneck to innovation — us.

Budgeting 9

Budgeting Software Entrepreneur Fixed Costs 9

Harvard Business Review

MARCH 1, 2018

However, if we do not develop and implement tools for pooling the financial cost of new high-cost treatments, access to them will be cut off, even for patients with generous insurance policies. Problems may get worse.

Cost 8

Cost Insurance Incentives Policies 8

Harvard Business Review

OCTOBER 6, 2014

UK retail, like the rest of the developed world, is witnessing a few big long-term trends. Hard discounters aim for twice the volume with the same fixed costs so they can make the same returns at half the gross margin. You might wonder how anyone can make money with such low prices. The answer is simple – selling more.

Retail 12

Retail Merchandising Discount Price 12

Harvard Business Review

APRIL 6, 2016

Taiwan, and South Korea, respectively — agreed to fund a novel technology development program at ASML, a leading equipment manufacturer based in the Netherlands. The program creates risk sharing, and the results of ASML’s development programs will be available to every semiconductor manufacturer without restriction.

Co-Opetition 8

Co-Opetition Operations Cost Cooper 8

Harvard Business Review

NOVEMBER 18, 2013

The advantages that hospital systems can derive from scale fall into four groups: Classic economies of scale focus on lowering the cost per unit of care delivered (e.g., Economies of scope can allow hospital systems to leverage their scale to develop new revenue streams. by acquiring physician practices or outpatient facilities).

Health Care 8

Health Care System Cost Price 8

Harvard Business Review

FEBRUARY 11, 2016

Google and Intel rely on experts in social science and biomechanics to develop transformative products by better understanding how people think about and use technology. Organizational Development Book. But there are also extrinsic factors that complicate the relationship. Adapted from. Agile Talent. Jon Younger Norm Smallwood.

Agility 8

Agility Organization Resources Fixed Costs 8

Harvard Business Review

SEPTEMBER 9, 2015

During an economic crisis, the exaggerated decline in orders can be especially damaging to upstream suppliers that have high fixed costs tied to production assets. Companies should anticipate this trend and start developing “value pricing” and less expensive products.

Supply Chain 8

Supply Chain Retail Crisis Operations 8

Harvard Business Review

APRIL 19, 2011

Meanwhile, declines in revenue and escalating fixed costs for things like public employee pensions and health care are crippling our cities budgets. In Charlotte, a challenge grant developed a way to improve capital planning and yield lower interest rates and other cost savings.

Short-term 14

Short-term Budgeting Health Care Long-term 14

Harvard Business Review

FEBRUARY 24, 2015

Decisive actions are required to tackle the factors that prompted the spin-off in the first place, which in many cases are underperformance and/or a lack of strategic fit leading to chronic underinvestment in the development of the business.

Chemicals 8

Chemicals How To Kahneman Reputation 8

Harvard Business Review

NOVEMBER 6, 2013

Working under a fixed-cost ceiling was, of course, difficult. We also developed an approach that put the Institute for Healthcare Improvement’s “ Triple Aim ” (improving the quality of the health care experience, improving the health of a population, and reducing per capita costs) at the heart of Scotland’s universal system.

Health Care 8

Health Care Constraint Budgeting Quality 8

Harvard Business Review

NOVEMBER 29, 2013

A fascinating business dynamic will unfold as health care providers in the United States shift from a reimbursement system that has historically paid for procedures performed to one that rewards population health — providing the total care of a community at a fixed cost and improving its members overall health.

Health Care 8

Health Care Committee Cost Operations 8

The Horizons Tracker

MARCH 23, 2023

Indeed, he worried that rising concentration was not so much a bug of industrial development but a key feature of it, as technological development increased the scale of both economies and the businesses within them. The authors highlight that this was something Marx famously warned about in Das Kapital.

Creativity 123

Creativity Innovation Trends Decentralization 123

Harvard Business Review

AUGUST 17, 2012

Cipla, an India-based producer of low cost antiretroviral drugs (ARVs) is one of the biggest success stories in the pharma industry. What's more, these are markets that traditional developed market firms are increasingly targeting for their own growth goals. and other traditionally developed markets.

Company 14

Company Pharmaceuticals Business Model Fixed Costs 14

Harvard Business Review

MAY 9, 2013

Harley helped V&S launch Fan Machine by enlisting its fans to develop a new campaign. In every part of the industry, the open innovation model is changing the economics of advertising by switching significant fixed costs to variable costs and sourcing creative from more relevant and, many times, lower cost sources.

Advertising 10

Advertising Brand Creativity Innovation 10

Harvard Business Review

FEBRUARY 22, 2011

As each of these companies expands its fixed-cost infrastructure, profits grow geometrically because the additional variable cost of adding each new user is near zero. Adding a profile on Facebook has little to no impact on Facebook's operating costs. Greater scale bestows greater competitive advantage.

CPA 15

CPA CPM Advertising Disintermediation 15

Harvard Business Review

JANUARY 5, 2017

Two developments bear noting. The media’s bias toward big events stems from three features of its economics: Fixed costs. The cost of covering a golf tournament doesn’t depend on whether Tiger Woods plays. Fixed costs have always been central to the economics of media. Where Does This Leave Us?

Media 12

Media Advertising Fixed Costs Content 12