Shareholder value is in, but most companies must take their game to the next level to deliver on this renewed promise.
Value is hot again. While management’s rekindled interest in shareholder value is laudable, if there is a danger in value’s resurgence, it is the assumption that managing for value is something companies already know how to do. Indeed, a common theme underlying many companies’ communications with investors these days seems to be: "Everything will be fine if we get back to the basics and do things the way we used to, before the ‘stock market bubble.’" This is a dangerous perspective. It implies that a company can generate strong shareholder performance without significantly changing its strategies, management processes, and organizational capabilities.