Hochschule München

Intended Learning Outcomes (Skills, Knowledge, Attitude)

"How important is it to actually live a company's values? Values provide internal and external orientation and legitimize decisions and actions. They also send a signal that the company is a reliable cooperation partner. They can, therefore, help businesses lower their costs and improve their economic value creation. If lived values have such advantages, why is explicit - and effective - values management not as widespread as one might think? How do inconsistencies between propagated values and actual behavior arise, and what is the role that misled expectations among different stakeholders may play?"—Editor (Schöler, Gabriele; Verl. Bertelsmann-Stiftung, pls. see literature)

Based on these critical questions cited above the students shall learn the concepts of

·         Valuation

·         Creating Value

·         Digitalization and technological advance

·         Capitalism

and how these concepts can be implemented successfully into financial strategies.

After the participation of this module the students are able to use the fundamental knowledge about how the capitalistic system functions, how the management of value creation of business works in a capitalistic context of a digital world, how the valuation of a business is based on this knowledge and to analyze and evaluate the results in a given context. The students are able to work on concrete problems out of these areas and to apply with the help of structured quality analyses and usable mathematical formulas. Especially in little working groups the students can exchange, understand and test their new knowledge about these areas of the module. Through the participation of this module the students recognize the dependencies of financial strategies from the capitalistic system in which it works and are able to use the knowledge about the economic system and the creating of financial strategies to drive business to higher longstanding value and transactions.

Contents

·         Valuation of business

·         Managing for value creation of business

·         Digital strategies to increase the valuation of business

·         Capitalism as the frame to understand value creation of business

·         Implementing financial strategies

·         Thinking, Fast and Slow (Kahneman)

·         Digital business models

·         Finance of innovations

Quantitative Methods

·         Models and methods for a valuation as state of the art

·         Models and methods for value creation incl. digital strategies

·         Models of Capitalism and its critics

·         Models and methods used in business administration

Applied methods in Economics and Business administration

r  Analysis models and methods (research and analysis models):

·         Process models (e.g. procedure of due diligence, procedure of business acquisition)

·         Business valuation models (individual and total valuation models)

·         Component models (e.g. time series analyses for key figures development)

·         Normative decision theory (e.g. assessment of the impacts of individual forms of financing)

·         Qualitative optimization models

·         Quantitative optimization models 

·         Forecasting models (budget figures)

·         Models of interaction (communication)

r  Quantitative empirical methods (comparative – statistical, mathematical methods, data analysis):

·         Key figures on the financial situation (such as liquidity, inventory turnover period), the income situation (e.g. return on investment, interest expense ratio), the financial position (e.g. cash flow figures, days payables outstanding); in this context, working with primary data and secondary data

·         Quantitative comparative analyses (e.g. statistical references from Standard & Poor’s)

·         Statistical analyses (e.g. medians of key figures in rating classes)

·         Mathematical business valuation methods of individual valuation; this includes:

·         Liquidation value method

·         Reproductive value method

·         Mathematical business valuation methods of total valuation; this includes:

·         Capitalized earnings method

·         Multiplier method

·         Discounted cash flow method

·         Empirical analyses in the context of case studies for business valuation (e.g. Weighted Average Cost of Capital, Capital Asset Pricing Model)

r  Qualitative and interpretative methods (expert interviews, polls, standardised surveys)

·         Qualitative company analyses (branch, organizational structure, management, business relationships, payment behavior)

·         Descriptive decision theory

·         Prescriptive decision theory

·         It is possible to conduct expert interviews as part of the project work

Teaching and Learning Styles

-          Lectures and discussions: Theory and Reality

-          Case studies and group work

-          Special guests lectures (N.N.)

-          Seminar paper

Literature

Anderson, Patrick L.: The Economics of Business Valuation: Towards a Value Functional Approach. Stanford University Press, Stanford, Calif. 2012

Audretsch, David B. / Link Albert N.: Valuing an Entrepreneurial Enterprise. Oxford Univ. Press, Oxford 2012. Electronically published: http://books.google.de/books?id=DWNnX-BYx5gC&printsec=frontcover&hl=de&source=gbs_ViewAPI&redir_esc=y#v=onepage&q&f=false

Cryan, Dan / Shatil, Sharron / Piero: Capitalism. A graphic guide. Gutenberg press, Malta 2009

Davidson, Ian / Tippett, Mark: Principles of equity valuation. Routledge Pub. New York 2012.
Electronically published: http://books.google.de/books?id=CrFiNE27m1EC&printsec=frontcover&hl=de&source=gbs_ViewAPI&redir_esc=y#v=onepage&q&f=false

Doyle, Gillian: The economics of the mass media. Edward Elgar Pub. Cheltenham 2006

Erasmus, Pierre / Dietmar, Ernst: International Business Valuation. UVK-Pub. München 2014

Fischer, Thomas: A service perspective on value creation strategies. Harland media Publ. Lichtenberg 2010

Fulcher, James: CAPITALISM: A very short introduction. Oxford University press. Oxford 2004

Hawawini, Gabriel / Viallet, Claude: Finance for Executives. Managing for Value Creation. 4th Ed. (or 5th Ed.) South-Western, Cengage Learning Publ. Mason, OH 2011.

Hirschheim, Rudy / Heinzl, Armin / Dibbern, Jens: Information System Outsourcing – Towards Sustainable Business Value. 4^th Edition, Springer Verlag 2014

Kreutzmann, Daniel: Company Valuation and Information in Analyst Forecasts. Logos Verlag, Berlin 2010. Electronically published: http://books.google.de/books?id=2USnuW3tLsUC&printsec=frontcover&hl=de&source=gbs_ViewAPI&redir_esc=y#v=onepage&q&f=false

Malecki, Edward J.: The digital economy business organization, production processes and regional developments. 1. Publ. London 2008

McKinsey & Company: Valuation. Measuring and Managing the Value of Companies. 5. Ed. John Wiley & Sons, Inc. Hoboken, New Jersey 2010

Meier, Andreas: eBusiness & eCommerce managing the digital value chain. Springer Verlag, Berlin 2009. Electronically published: http://books.google.de/books?id=4HZwDeu7VCwC&printsec=frontcover&hl=de&source=gbs_ViewAPI&redir_esc=y#v=onepage&q&f=false

Moore, Jason W.: Capitalism in the Web of Life – Ecology and the Accumulation of Capital. Verso-Verlag 2015

Neal, Larry / Williamson, Jeffrey G.: The Cambridge History of Capitalism – Two Volume Set. Cambridge University Press 2014

O‘Sullivan, Kevin: Strategic Intellectual Capital Management in Multinational Organizations Sustainability and Successful Implications. Business Science Reference. Hershey, PA 2010

Piketty, Thomas: Capital – in the Twenty-First Century. The Belknap Press of Harvard University Press. Cambridge, Massachusetts London 2014

Provost, Foster / Fawcett, Tom: Data Science for Business – What you need to know about data mining and data-analytic thinking. 1st Edition, O’Reilly & Associates 2013

Reilly, Robert F.: The Handbook of Advanced Business Valuation. McGraw-Hill Pub, New York 2000.
Electronically published: http://books.google.de/books?id=vOnLAyTSk_wC&printsec=frontcover&hl=de&source=gbs_ViewAPI&redir_esc=y#v=onepage&q&f=false

Schöler, Gabriele: Values management and value creation in business case studies of internationally successful companies. Verl. Bertelsmann-Stiftung, Gütersloh 2009

Thomas, Rawley: The valuation handbook valuation techniques from today's top practitioners. Wiley Verlag, Hoboken 2010

More literature at the beginning of the course