Naina.co
  • Blog
    • Everything
    • Only Articles & Writing
    • #NAINAxStyle
    • Podcast : The Naina Redhu Experience
    • EyesFor…
      • #EyesForLuxury
      • #EyesForLifestyle
      • #EyesForDestinations
        • #EyesForIndia
        • #EyesForDubai
        • #EyesForEurope
        • #EyesForLA
        • #EyesForLondon
        • #EyesForNewYork
      • #EyesForPeople
      • #EyesForStreetStyle
      • #EyesForDining
      • #EyesForTechnology
      • #EyesForFashion
        • New York Fashion Week
        • Amazon India Fashion Week AW15
      • #EyesForBeauty
      • #EyesForPeople
    • Art
    • #MadeInIndia
    • #NAINAxADOBE
    • #NosedByNaina
  • Photography Portfolio
  • Contact & About
  • Press
  • Clients
  • Newsletter

NAINA.CO

Instagram
Twitter
YouTube
Pinterest
LinkedIn
Spotify
Facebook
online brand building, photography & art
Naina.co
  • Blog
    • Everything
    • Only Articles & Writing
    • #NAINAxStyle
    • Podcast : The Naina Redhu Experience
    • EyesFor…
      • #EyesForLuxury
      • #EyesForLifestyle
      • #EyesForDestinations
        • #EyesForIndia
        • #EyesForDubai
        • #EyesForEurope
        • #EyesForLA
        • #EyesForLondon
        • #EyesForNewYork
      • #EyesForPeople
      • #EyesForStreetStyle
      • #EyesForDining
      • #EyesForTechnology
      • #EyesForFashion
        • New York Fashion Week
        • Amazon India Fashion Week AW15
      • #EyesForBeauty
      • #EyesForPeople
    • Art
    • #MadeInIndia
    • #NAINAxADOBE
    • #NosedByNaina
  • Photography Portfolio
  • Contact & About
  • Press
  • Clients
  • Newsletter
0
  • Innovation & Networking

Slippery Intangibles

  • July 29, 2004
  • naina

The contemporary manager has a problem. It is no longer possible to touch or see the things that matter to business performance. A long-term shift from tangibles to intangibles is occurring in many industries. The focus is no longer mainly on cash, inventory, plant and equipment or land, which typically accounts for only about one-fifth of a firm’s value.

Instead, more slippery considerations such as vision, motivation, various types of explicit and implicit knowledge, customer and employee loyalty, and brands are the key determinants of an enterprise’s performance. In 1982, 60% of the value of the United States S&P 500 companies was accounted for by tangibles. By 1999, it had fallen to 16% (the figure remains below 20%). According to the consultancy firms Accenture and AssetEconomics, by mid-2003, $US7.6 trillion, or 58% of the value of the US stockmarket, was a valuation of the future potential of intangibles.

A 2003 survey by Accenture, AssetEconomics and the Economist Intelligence Unit of American companies found that half the executives listed the management of intangibles as one of their top three priorities. Yet only 5% said they had a robust system of measurement. One- third had no measurement in place, and 61% had measures that were either informal or unorganised. John Barton, principal of John Barton Associates, says companies have trouble developing the new ways of thinking required to understand and assess intangible assets. “What you see in company after company is that knowledge management is pushed back into IT.”

What is required is not a modification of the methods used to value tangibles but a radical departure. Intangible assets are considered to be elements such as innovation, knowledge (explicit and tacit), governance, organisational design, reputation, customer and employee loyalty, capabilities and brand strength. The way in which these are bought, sold and created, is different from tangible assets. For one thing, intangibles have a more uncertain value than is usually the case with tangible assets. Investing in knowledge generation, for instance, can lead nowhere or it can lead to high- value returns. The result of an investment in plant and equipment, by contrast, is comparatively predictable.

Some intangibles have completely different characteristics from tangibles. Knowledge, for instance, is usually not scarce in the way tangible assets are (because it is not lost to the owner when sold). Possessing knowledge is to some extent inevitable in a business, whereas owning a tangible asset is not. It is hard to imagine a business without knowledge, at least if it is to have any hope of staying in existence. Businesses cannot “own” knowledge, except to the extent that they can legally protect its fruits through patents and brand names. The push from the accountancy community to take a pessimistic view of intangibles on the balance sheet is at least half right.

The “snapshot” approach to valuation (the balance sheet is a snapshot of a business’s value at a moment in time) is not ideally suited to getting a grip on intangibles. What really matters is what income they will create, not what their resale value is (which means taking a close look at what customers will pay for in the future). For example, important staff members may create great value for an organisation, but they cannot be bought and sold in the way that, say, land can. Resale value is largely a meaningless measure for “human capital”.

The greatest challenge is in human-resources management. The term itself inspires little confidence (humans are in no meaningful sense “resources”). Yet if intangibles are to be managed well, much depends on the way people are managed. All intangibles gain value only because of what people do. Peter Aughton, chief executive of the consultancy Amerin and director of the Fred Emery Institute, says human-resource managers might do well to drop the title. “Human-resource managers often come through a background of the humanities, but somehow they lose their roots and try to run things as a machine. They get lost in bureaucracies and … the reward structure.” Barton says what is required is “360-degree stakeholder management” – not just training workers to be multi-skilled, but also to involve them in management. Without this, the necessary innovation and flexibility will not materialise.
 
One way to derive an assessment of intangibles is to use “future value analysis”. According to an article by John J. Ballow, Robert J. Thomas and Goran Roos in the Journal of Applied Corporate Finance, this is the difference between a company’s market capitalisation (the total value of its shares) and the “current value of daily operations”. The general rule of thumb, they say, is that capitalised current operating value equals 10 times the current earnings.
 
Future value is only a tentative indication of a company’s need to manage intangibles but, in combination with net tangible assets as a proportion of the share price, it does give an idea of a company’s position. Ballow, Thomas and Roos write that no US companies include accounting for intangibles in their annual reports. Only in Europe have there been serious attempts to improve the accounting for intangibles.

Source: BRW Magazine, by David James

Total
0
Shares
Share
Tweet
Pin it
Share
Share
Share
Share
Share
Share
naina

Previous Article
  • Innovation & Networking

Organizational Culture

  • July 28, 2004
  • naina
View Post
Next Article
  • Innovation & Networking

Creating an Innovation Mindset

  • July 29, 2004
  • naina
View Post
You May Also Like
NainaCo-Photographer-Storyteller-Luxury-Lifestyle-Raconteuse-Ello-Social-Network-Profile-NainaCo
View Post
  • Articles & Writing
  • Innovation & Networking

ELLO

  • naina
  • October 6, 2014
View Post
  • Innovation & Networking

What I am up to

  • naina
  • September 7, 2011
View Post
  • Innovation & Networking

Been too long

  • naina
  • September 7, 2011
View Post
  • Innovation & Networking

Online Business Networking Status

  • naina
  • May 3, 2009
View Post
  • Innovation & Networking

Bootstrap Logo : Logos for startups

  • naina
  • May 3, 2009
View Post
  • Innovation & Networking

Imtiaz Khan discovers LinkedIn

  • naina
  • September 5, 2008
View Post
  • Innovation & Networking

2BHK Apartment for Sale

  • naina
  • August 1, 2008
View Post
  • Innovation & Networking

Customer-Centered Innovation Map

  • naina
  • May 12, 2008




Naina Redhu is a professional photographer & visual artist.

Her career, spanning 16 years, started with an MBA in IT & Systems, to a job as an Innovation Management Consultant, to branding & graphic design work for international clients, to a full-time solo-entrepreneurship as an Experience Collector.

Naina started her blog 16 years ago and it has evolved from writing about Creativity & Innovation, to sharing case studies about Branding & Graphic Design to finally a destination for some of the leading Luxury & Lifestyle brands as Naina writes features for these brands and photographs them.

Having traveled all over India as a child ( the advantage of having a father serving in the Indian Army ), she is also well-traveled across Europe ( Austria, Switzerland, Netherlands, Italy and France ), Asia ( Bhutan, Sri Lanka, Thailand, and Vietnam ), America ( New York, Los Angeles and San Francisco ), and Canada.

Naina has her own podcast called The Naina Redhu Experience, where she talks about the business and professional aspects of photography, blogging and influencer marketing in India.

Her abstract art, under the KhaosPhilos label can be shopped on the Naina.co online store and she is available for bespoke commissions as well.

"The New Rules of Online Brand Building", Naina's on-ground workshop, recently wrapped up its 7th Edition. Launched in 2018, "Workshops By Naina" is going to be seeing more editions across the country & online.

Naina is also available for hire as a Speaker. She has been invited as a Keynote Speaker at a blogging conference and also speaks about the business of photography in India.

Always learning & evolving online, she has presence across several online spaces including Twitter, Instagram, Facebook, YouTube, Pinterest, LinkedIn, TikTok and her podcast can be found on all podcast channels and apps.

#EyesForLuxury
  • janavi india, jyotika jhalani, naina redhu, LMIFWSS21, FDCI, Shaurya Athley, aprajita puri, janavi love, fdci goes digital, talisman, handcrafted, made in india, cashmere, shawls, luxury cashmere, eyesforluxury, madeininda, cashmere, kiera chaplin, spectaculars, eyeforfashion, fashion week, india fashion week, lotus india fashion week 2020, fdci fashion week 2020
    Talisman by Janavi India #LMIFWSS21 : Evil Eye Luxury Cashmere Collection
    • October 18, 2020
  • midsummer jardin, hand-painted jacket, impressionist, pointillism, impressionism, post-impressionism, contemporary art, khaosphilos, wearable art, wear a painting, wear art, made in india, make in india, madeinindia, makeinindia, wearableart, wearart, wearapainting, khaos philos, naina redhu, naina.co, naina, indian artist, art on garments, painted jacket, painted blazer, flower garden, midsummer garden, artist's garden, monet, seurat
    Midsummer Jardin : More About My First Hand-Painted Jacket #KhaosPhilos
    • May 31, 2020
  • bmw, eyesforluxury, automobiles, automobile brand, bayerische motoren werke ag, german company, german automobile, bmw 8 series gran coupe, the8, luxury grand tourer, four door, thegentlemanconnoisseur, nainaxbmw, india art fair, bmw at the india art fair, bmwatiaf, indiaartfair2020, new delhi, lifestyle photographer, luxury photographer, car, automobile photographer, art photographer, art fair, naina redhu, naina, naina.co
    BMW at the India Art Fair 2020 #EyesForLuxury #BMWAtIAF
    • February 22, 2020
#KhaosPhilos Art Label
  • wearable art commission, art commission, contemporary art, brooch commission, william grant and sons, hendricks gin, cucumber and rose, rose and cucumber, artist, original art, certificate of authenticity, gin brand, roses, cucumbers, naina redhu, naina.co, khaosphilos, madeinindia, handmade, hand-painted, circular canvas, round brooch, magnet clasp, artist commission, painting commission
    #WearableArt Brooches Commission for Hendrick’s Gin
    • April 19, 2021
  • brooch, magnet clasp, hand painted, hand cut, acrylics on wood, original painting, one of a kind, independent artist, made in india, spring drip, naina redhu, khaosphilos, handmade, handcrafted, single artisan
    “Spring Drip” Art Series of Brooches #WearableArt
    • February 11, 2021
  • The “NUANCE” Wearable Art Series of Brooches Made From Hand-Cut Paint
    • November 26, 2020
Social Links
Products In The Shop
  • Brooches (97)
    • 2 Inches Diameter (41)
    • 2.5 Inches (39)
    • 3 Inches Diameter (15)
    • Oil (1)
    • Sculptural (53)
  • Collections (134)
    • ALIVE (6)
    • Benches (5)
    • DOTS (17)
    • HORIZONS (23)
    • IN TIME (16)
    • METALS (20)
    • NUANCE (8)
    • Paper 2018 (20)
    • Spring Drip (6)
    • The Early Experiments (18)
  • Garments (14)
    • Caps (2)
    • Masks (11)
  • Original Paintings (38)
    • On Canvas (16)
    • On Paper (20)
  • Prints (32)
    • Paintings (22)
    • Photographs (9)
    • Posters (1)
  • SOLD (53)
  • Uncategorized (21)
  • Workshops (3)
Your Cart
#EyesForDestinations
  • narendra bhawan bikaner, narendra bhawan hotel, bikaner luxury hotel, naina redhu, holi 2021, narendra bhawan, siddharth yadav, swimming pool, traveller's table, suryagarh, private haveli, private pool, suryagarh jaisalmer, holi celebrations, bikaner railway station, gurgaon railway station, bikaner to gurgaon by train, gurgaon to bikaner by train, pranay baidya, duck salad, eyesfordestinations, eyesforluxury, india, rajasthan, eyesforrajasthan, eyesforindia, rajasthan tourism
    A Rajasthan Holi, 2021
    • April 7, 2021
  • narendra bhawan bikaner, narendra bhawan, eyesforrajasthan, eyesfordestinations, bikaner, rajasthan, travel photogapher, nainaxnarendrabhawan, best boutique hotel in india, indian boutique hotel, narendra bhawan india, narendra singh, naina redhu, naina, lifestyle photographer, travel blogger
    The Nine Stages of Experiencing Narendra Bhawan Bikaner
    • December 17, 2020
  • bhairon vilas, bikaner, hotel bhairon vilas, dive bar bikaner, dive bar, narendra bhawan bikaner, rajasthan, eyesfordestinations, eyesforrajasthan, rajasthan photographs, travel photographer, bikaner photographs, bikaner bar
    The Dive Bar at Bhairon Vilas, Bikaner
    • December 9, 2020
ART SHOP
  • Cucumber & Rose, 2021, 2.5 Inches ₹5,000.00
  • Repeatedly Relentlessly Resourceful, 2021, 64 Inches in Diameter, Hand-Painted Acrylics on Stretched Canvas ₹1,920,000.00
  • Fragrant Flames, 2021, 16x16 Inches Acrylics on Canvas ₹152,832.00
  • Savannah Cloud, 2021, 16x16 Inches Acrylics on Canvas ₹152,832.00
  • Lipstick Hot And Pink, 2018 #TheEarlyExperiments ₹5,000.00
  • Lipstick Orange And Pink, 2018 #TheEarlyExperiments ₹5,000.00

All Copyright rests with Naina Redhu. All Rights Reserved 2020. Written permission is required for you to copy & use images or text from this website. Email n@naina.co to ask.

NAINA.CO
  • Blog
  • Photography Portfolio
  • Contact & About
  • Press
  • Clients
  • Newsletter
All Rights Reserved. Copyright Naina.co 2020.

Input your search keywords and press Enter.