Share price for strategy analysis

It is often be useful to study the historical share price of a company. The historical development can tell us what strategic actions and initiative that are liked and disliked by the investors. We should not assume the investors are always right, in fact they are often wrong, but it is nevertheless important to understand the investor perspective. We can also learn about the mindset of the key executives by looking whether their experience is one of growth or decline. 

For an analysis to be meaningful, the share price cannot be analysed directly. In particular it is important to remove the effect of the general stock market. In finance, the resulting time series is called the company's abnormal return. This post will outline how to describe a company's abnormal returns and what kind of question you can ask yourself when analysing the abnormal returns.

Western companies failing in China

Companies entering foreign markets can make large mistakes by not adjusting sufficiently to the local environment. This is especially the case with Western companies entering China, because the cultural gap is large. This note will focus on failures relating to strategy.

CEO and strategy fit

The chief executive officer is an important person. Can anything important be learnt by watching a video of the CEO?

Cultivate your network

Once you have created a social network, it has to be maintained. In this note I describe three strategies to help you maintain your network. This is part two of three.

Create a network at university

Business schools are ideal places to create and extend your social network. In this note I describe five useful strategies. This is part one of three.

Is the growth-share matrix (aka BCG matrix) useful?

The growth-share matrix was created by BCG, the consultancy, in the late 1960s based on work with a paper mill. Paper manufacturing is dependent on economies of scale and economies of learning, so market share went on the x-axis. Companies want to grow, so growth went on the y-axis. This model turned out to be immensely successful for BCG and it was implemented by many companies in the 1970s. 

Should the international community allow ethnicity to determine country borders as a principle?

The Ukrainian region Crimea is predominantly ethnically Russian (or at least Russian speaking). If the citizens living in this region want to secede and join Russia or form their own nation state, should they be allowed? According to the Ukrainian constitution, secession is not allowed by a plebiscite unless all Ukrainian are allowed to vote. I find this question quite fascinating and we are likely to face many such questions in the future. 

Morphing political parties in Sweden

Sweden has two elections this year, one for the European Parliament and one for the Swedish Parliament. I am going to write a bit about Swedish politics from time to time on this blog. I came across the site Political Compass, which uses a modified version of what is normally called the Nolan chart; consider it the standard map to describe political parties.