Posted by Reilly Atkinson on June 19, 2001 at 14:23:30:

In Reply to: Re: Why would you implement KM? posted by Jerome Peloquin on June 18, 2001 at 01:18:14:

Jerome -- First of all, in this age of free-form accounting, profit is not at all well defined. Further no small number of folks would argue that stock prices are the end all be all of corporate life. The correlation between profitability and stock price is certainly positive. However since attempts at forecasting stock prices have been quite ineffective, there is no strong evidence to say that profits drive stock prices. In the last market bubble, many companies conned unwary investors that market share was the elixer of life, or that joi de vie (sp?) could conquer all. And then there's ROI, so beloved of Division Managers. In short, the measures of corporate success vary greatly, and can and do use different measures of profitability (even from year to year)

I've run a couple of small consulting firms. We focussed on custom projects in no small measure because we wanted challenging work. Sometimes we lost money because we underbid, but felt that we must finish to maintain our reputation and honor. Quality above all, not profit. (The businesses still exist)

And note, many senior managers, with their complex employment contracts, pay more attention to their compensation than to overall corporate success. Many make huge bucks even when coprate perfomance goes south -- so much for profit.

Regards,
Reilly Atkinson

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Follow Ups:

• Re: Why would you implement KM? David L. Joseph 15:32:18 06/22/01 (1)
  • Re: Why would you implement KM? Reilly Atkinson 18:33:08 06/23/01 (0)

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