A large publicly listed Danish medical company
Developing a long-term corporate strategy using shareholder value techniques
Using our distinctive corporate strategy methodology, including Managing for Shareholder Value techniques, PA Consulting Group helped to define this company’s ‘vision’ for the year 2010 and outline the strategies to realize this vision. The short-term results of this strategy review have been considerable, leading to an increase in share price of 65%.
This company has for many years demonstrated a significant increase in Total Shareholder Return (the combined return from dividends and share price growth). Shareholders’ expectations that this growth will continue are therefore high. However, Group Management could foresee that by 2005, growth opportunities in the markets of the six existing product lines would be limited and revenue would be too low to satisfy shareholders’ expectations.
To help develop the new corporate strategy, PA used a number of MSV and strategy development concepts and methods. These included valuation, value-driver analysis, value mapping, parenting advantage and option development. The methods were tailored to the needs of the company.
Following the strategy review, the company is now equipped with:
- A clear framework for Managing for Shareholder Value
- A strategy to close the gap between target and expected performance, each year from year 2000–2010
- A route map outlining how to implement the administration and systems of shareholder value tools and techniques
- A project plan for future new business opportunities
- A new culture in Group Management and the wider Corporate Management Group, in terms of their thinking, focus and structure.
|
