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Chapter One: The Problem At one time, entrepreneurs always knew the basic importance of cash in valuing their businesses. Usually, they would very simply work out a comparison of their total expected returns with what they can plausibly earn elsewhere, with the same amount of money at the same level of risk (i.e., the opportunity cost of capital). However, major developments in American capitalism have obscured this approach. First, although shareholders own a corporation, control over its operations is held by professional managers, whose interests often diverge from those of the majority of shareholders. In addition, managers possess detailed information about the companys prospects that outside shareholders lack. Lacking inside information, shareholders accept accounting measurements to gauge corporate value; however, these measurements were never intended for this purpose. Accounting criteria are inadequate and misleading because they elevate net income, which is translated into earnings per share (EPS), to supreme importance. As a companys EPS grows, its share price is supposed to rise, assuming that its P/E ratio remains relatively constant. To work their way to net income, accountants make several profit- Joel M. Stern and John S. Shiely with Irwin Ross 2001 Joel M. Stern and John S. Shiely Publisher: John Wiley & Sons ISBN 0- 471- 40555-8 The EVA Challenge Implementing Value-Added Change in an Organization Volume 18, Number 13 Copyright 2001 Business Book Review, LLC All Rights Reserved Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 2 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved and-loss calculations that distort reality. For example, instead of regarding R&D, advertising/marketing, and training costs as investments and capitalizing them, they expense these items, which has the effect of understating a companys true profit for the year. Accounting practices also cause distortion on a companys balance sheet. An asset it listed either at original cost, less depreciation, or at market value, whichever is lower. Of course, in a rising market, this understates value. Or, when one company buys another, and the transaction is listed as a pooling of interest, there is no adverse impact on future earnings. These practices fail to focus on measurements that assess the underlying economic reality of the company criteria relevant to shareholders. Instead, their purpose is to value assets and the operating condition of the company conservatively, in order to give lenders an idea of what they could collect if the company were to fail. This is the accountants book value, but it reveals little about market valuethe amount of cash shareholders can take out of the company. In addition, the calculation of EPS is easily manipulated by senior executives, whose bonuses may be tied to earnings improvement. Oftentimes, they cut back on R&D or advertising in order to lower costs and raise stated profits, engage in trade loading (an earnings management trick often employed in consumer goods companies), utilize merger magic gimmicks, overstate the expenses of restructuring, or use unrealistic assumptions to [overestimate] liabilities such as sales returns, loan losses, or warranties. Although a number of corporations have attempted to escape the EPS trap by basing bonuses, in part, on ROE, ROI, or RONA (return on net assets), because they are better indicators of corporate performance, they too can be manipulated. Another problem is that executive compensation increases as the size of the corporation increases. However, this sets up a perverse incentivegrowth for the sake of the personal rewards it brings, which has nothing to do with enhanced shareholder value. In the 1960s and 1970s, the conglomerate became all the rage (the easiest way to grow is to merge or acquire), and high-profile conglomerates enjoyed a sharp increase in their share pricesin the short term. But, in the long term, many of them were disasters, and by the late 1970s, widespread disillusion with conglomerates led to a lot of talk about true shareholder value and how it had been betrayed by incumbent management. This led to the rise of hostile takeover artists, the LBO, and the pursuit of greenmail. The LBO has been effective in that it has turned managers into owners and burdened them with a debt load that forces them to be efficient or face bankruptcy. However, they are also a cumbersome and expensive way of creating shareholder wealth. Great effort goes into putting the deals together, high fees are necessary to motivate LBO firms, and huge debt discourages risk taking. Economic Value Added (EVA) is simpler and far more flexible. Chapter Two: The Solution Economic Value Added is the profit that remains after deducting the cost of the capital invested to generate that profit. In the EVA equation, the cost of capital includes both debt and equity capital. Properly implemented, EVA aligns managements interests with those of the shareholder, because real economic profit is the measure of corporate performance. This goal benefits the shareholder, and About the Authors Joel M. Stern is the managing partner of Stern Stewart & Co. and serves on the faculties of five graduate business schools. He is a leading advo- cate of the concept of shareholder value and a widely published writer. John S. Shiely is president of Briggs & Stratton, one of the most successful implementers of EVA. Irwin Ross, a regular contributor to Stern Stewarts EVAngelist, has authored a number of books, including The Loneliest Campaign, The Image Merchants, and Shady Business. He has also writ- ten for a variety of magazines, including Fortune and Harpers and was formerly a roving editor for Readers Digest. Lenders are much less interested than shareholders in going-concern values, and more concerned about liquidation values. Jerold Zimmerman, Simon School of Business Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 3 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved because bonuses are tied to EVA, managers are no longer interested in manipulating EPS, ROI, or RONA. EVA is the net operating profit after tax (NOPAT), less a capital charge that reflects a companys cost of capital (i.e., required rate of return). If the firms profits are only equal to the required rate of return, the investor has not made any money. Thus, the merit of EVA is that it is a system for determining corporate performance based on hard data rather than projections. NOPAT is a key ingredient. Although net normally means after tax, in the EVA equation, net refers to the adjustments one must make to eliminate various accounting distortions. These adjustments must have an effect on managements behavior, be easy to understand, and have significant impact on the companys market value. Costs for R&D, advertising and promotion, and staff training and development are among the most common adjustments. Under EVA, these costs are included on the companys balance sheet and amortized over the period of years during which they are expected to have an impact. In deriving NOPAT, only the annual amortization charge is included as a cost item. Taxes show up in the NOPAT calculation only in the year in which they are paid. In contrast, accounting custom deducts them in the year they were deferred, which distorts the companys operating results for any one year. The same considerations apply to the reserves set up to pay the costs of fulfilling warranty obligations. NOPAT provides an accurate picture by listing only the actual disbursement of warranties during the year. Whereas corporate tax departments use accelerated depreciation, EVA uses sinking fund depreciation. The annual charge does not vary from year to year, but the return of principal is small early on and dominates later. This reflects the actual decline in the economic value of facilities and equipment in later years, which is mirrored by steeply declining asset values on the balance sheet. Under EVA, the full price paid for acquisitions is recorded on the balance sheet, even if the pooling of interest method is used. This forces managers to impose practical limits on the prices they pay for acquisitions, especially if their incentives are tied to EVA. In these ways, EVA provides strict restraints on the extravagant use of capitalnot only for the company as a whole, but for divisions, a factory, a store, or even a product line. Chapter Three: The Need for a Winning Strategy and Organization A fully articulated EVA system is not a sufficient condition of success if a company does not also have a winning strategy and an appropriate organization. This involves identifying a suitable competitive position (i.e., defining the core business) and then dedicating all of the organizations time, resources, people, and capital to reaching and sustaining that position. In formulating a high-value strategy, the role of growth must be considered. Optimum growth is not by itself evidence of shareholder valued added; revenue growth without capital discipline destroys value. However, companies that only continue to earn the cost of capital on a stable or shrinking capital base exhibit Market Value Added (MVA) that is less than impressive. Market Value Added, defined as the difference between the market value of a company and the amounts invested in it over the years, also precisely captures the gains or losses accruing to a companys shareholders. If present market value is greater than total investment, the company has created wealth. If not, it has destroyed wealth. Thus, there is a significant link between EVA growth and growth in MVA. To achieve continuous increases in EVA and MVA, a company must develop a growth strategy that has reasonable promise of success. Once management has embraced a particular value disciplineeither cost leadership, product leadership, or best total solution, based on the identified core competencies of the businessit is duty bound to explore every avenue of potential growth that is consistent with that discipline and reasonably likely to deliver at least a cost-of-capital return. It is equally important to create an organizational architecture that furthers the chosen strategy. This structure must expedite internal information exchanges and coordinate behavior across the various parts of the organization. For most organizations of any significant size or maturity, segmentation (along geographic, process, product, industry, or customer lines) and decentralization As a measurement system, EVA is not only a guide and a prod to managers seeking to maximize returns, but also a godsend to investors trying to determine the reality behind the maze of accounting numbers. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 4 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved are the answers. Companies that create the greatest value tend to assign capital decisions at the level in the organization where there is the best information to make that assessment. At the same time, the organizational architecture must ensure that there are appropriate systems in place to evaluate performance and provide rewards to motivate desired behavior. EVA centers (i.e., an investment center where the chosen performance measure is EVA) require the broadest grant of decision rights relative to the array of subunit decision assignments (e.g., cost, expense, revenue, profit, and investment centers). To designate a subunit as an EVA center, management must believe that value optimization will be achieved if profit and capital expenditure decisions are assigned to the subunit, and management must be willing to relinquish control in assigning those decision rights. If thats not the case, the only EVA center will be the entire firm. The organizational level at which EVA centers should be created is determined by the size of the organization, where relevant information is located within it, and the extent to which subordinate units are self-contained and effectively led. Chapter Four: The Road Map to Value Creation After decades of indifference, now companies have increasingly moved, not only to increase shareholder value, but also to align shareholder interests with those of other stakeholders. The goal has been to create value (i.e., maximize the amount of total wealth) for all groups involved. How this value is increased is different for every organization, depending upon competitive position, proprietary capabilities, and internal operational challenges. The Briggs & Stratton holistic model of Managing for Value Creation enables companies to communicate to employees and other stakeholders precisely what is involved in creating value. The model identifies the groups (employees, customers, suppliers, and communities) for which everyone in the organization should be dedicated to creating value. The most important functions associated with each group, and which integrate each group into the value-creating process, are set forth. However, none of these functions must be associated with specific corporate departments. This kind of distributive thinking (that focuses on dividing up the existing pie rather than enlarging it) is what EVA attempts to replace. The model can be extended to include a one-page Road Map to Value Creation that identifies key methodologies for creating valuestrategies, structures and systems, and designs and processes. This gives employees important insights into how the companys various value-creating initiatives coalesce. Each employee can see how the company intends to create value in his or her own primary functional area. And, each can see how the companys strategies, structures and systems, and designs and processes are integrated along functional lines. One of the greatest failings of modern management is, perhaps, the belief that any good idea can effectively be plugged into an organization. However, the discipline of preparing a road map to allows management to look at the consistency of strategy across functions. This makes it more difficult to err by plugging in a best-total-solution type of process, for instance, into the strategic framework of a cost leader. Chapter Five: The Changes Wrought by EVA Usually companies are attracted to EVA because theyre in trouble, and EVA reorients the corporation in the direction of true economic profit. For example: In 1992, Herman Miller, the celebrated furniture manufacturer, suffered its first loss in years. It rallied temporarily, but by 1994-1995, it was ailing seriously. Although sales were increasing, so were operating expenses and the amount of capital spent. Too many executives reported to the CEO, and too many consultants were involved because there was no formal method of making trade-offs. In January 1996, the company adopted EVA, and by the end of fiscal 1998, it boasted record sales of $1.7 billion, record profits of $128.3 million, and record EVA of $78.4 million (an improvement of nearly $70 million). In addition, Millers share price surged from $7.72 (adjusted for two stock splits) to $27.69. In 1990, The Manitowoc Company, an owner of shipyards and a highly diversified manufacturer of ice- cube-making and refrigeration equipment and construction cranes, was in a state of malaise, typical of a mature company. Earnings were failing and there was no market growth in any of its products or companies. An EVA Those companies that have shown a consistent ability to earn more than the cost of capital are most likely to succeed when they expand their range of activities. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 5 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved program was instituted, and, EVA went from a negative $12 million in 1993 to a positive figure in 1995. By 1998, it had topped $30 million, and in 1999, it reached $41 million. Chapter Six: Extending EVA to the Shop Floor Although EVA is effective and practical on the shop floor, most companies start EVA bonus programs at the executive level, gradually pushing it down through managerial ranks, and then on to salaried personnel. Hourly workers tend to be left out. Sometimes this is due to union resistance; sometimes it is because management believes that workers lack the decision-making capabilities to respond effectively to EVA incentives. This view overlooks the great store of knowledge about the production process that can be tapped if workers participate in EVA. While conflict is inherent in the bargaining process, there is also a tradition of union-management cooperation. Many unions understand that enlarging the pie benefits the rank and file. They will also be attracted by the fact that the cash-adjusting features of NOPAT and capital calculations address the concern that management might eliminate accruals in order to reduce the size of the bonus available to union workers. However, winning over the rank and file, directly, can be the real key to success in promoting EVA on the shop floor. Although unilateral discussions, with hourly employees concerning wages, benefits, and other terms of employment, are off limits, management may discuss EVA as a performance metric. Management may also train employees in EVA basics and in how to apply the strategies to their work areas. To most unionized employees, the value creation process is incomprehensible because they are not made privy to the companys value discipline, operating model, and the basic economics of the particular operations in which they are involved. Thus, they do not trust management because they dont know what the business is up to. EVA can help explain previously incomprehensible decisions, providing the kind of information that will drive behavior and create a participative workforce. An understanding of EVA can also allay job-security concerns (perhaps the greatest concern of the unionized employee). If a plant or division cannot be EVA-positive in the long run, it cannot continue to exist. Once the rank and file are convinced, it will be easier to persuade the union leadership to adopt EVA as a basis for incentive compensation. Chapter Seven: Getting the Message Out Training and Communications EVA represents a major transformation in the way a company measures its performance, rewards its staff, and even how it conducts every aspect of its business and practices. Although change can rejuvenate an organization, those in the trenches are likely to perceive it as a threat. Thus, training employees is the most important aspect of implementing an EVA program. It is far better to offer clear, detailed descriptions of imminent changes that explain and persuade than it is to coerce. All this should be part of a formal training program, at the onset of EVA implementation, followed by ongoing communications with the workforce. Chapter Eight: EVA and Acquisitions Because of global competition and rapid technological change, monopoly power, as well as oligopoly power, is now beyond the aspirations of most companies. Thus, the motive for acquisition must be the creation of additional value on the part of the acquiring company, reflected in a rise in its share price. Additional value must also accrue to the sellers shareholders, by way of a premium, unless the seller is failing. EVA analysis is an excellent method of calculating whether a proposed acquisition creates value, and if so, how much. There are two parameters that have the greatest effect on the likelihood of success: (1) the types of products/services produced by the acquired business and (2) the nature of the potential integrating efficiencies (i.e., financial, managerial, and operational). While financial synergies have the least likelihood of creating value, opportunities to mine value become considerably more concrete on moving into managerial synergies. However, the biggest increase in economic value is likely to be garnered in the area of operational synergies, because they have the potential for substantially reducing costs and also for driving revenue growth through a broader exploitation of the fixed costs and capital bases Including employees in the value-creating process will change their entire view of themselves, their colleagues, their superiors, and their company; they will think and act like owners. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 6 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved of the merged companies. Looking at the products/services parameter, the greatest potential for creating value is in the acquisition of companies that have comparable product/services lines. The acquiring enterprise is likely to understand clearly the competitive and operational challenges of the acquired business and will be able to realize economies of scale, distribution, and development, quickly. Nonetheless, realized synergies may not compensate for an excessive acquisition premium or a flawed analysis of the targets competitive and operational challenges, or of its projected growth profile. Less attractive businesses can also be part of the package. And, differences in cultures, financial systems, pay plans, etc., can make integration difficult. Thus, what can be achieved expensively through acquisitions can often be gained more cost-effectively through various forms of strategic alliance, including licensing, contract development, contract manufacturing, commercial agreements (nonequity ventures), partial equity ventures, and joint ventures. Chapter Nine: EVA Incentives Nothing is more important to the success of EVA implementation than a carefully designed EVA incentive program. Without an incentive program, employees will be rewarded for achieving goals (e.g., earnings per share) that may be counter to EVA goals. Besides, ROI and RONA (frequent criteria for executive bonuses) are flawed. EVA incentive plans, on the other hand, have several benefits. They are not set annually in lengthy negotiations but are fixed in advance for a three- or five-year period. EVA bonuses are also uncapped; thus, if the company is successful, bonuses amount to a far higher proportion of total compensation than is offered under traditional bonus plans. The essence of an EVA incentive plan is that it promotes increased shareholder value, in concert with the EVA measurement program and management system. The target is the annual expected EVA improvement, and achieving it will result in receipt of 100 percent of the target bonus, which is a percentage of the employees annual salary (typically 100 percent for the CEO, down to 10 percent for the lowest-ranking employee). Moreover, because bonuses are uncapped, the target bonus will be exceeded if EVA improvement exceeds its target by a stipulated amount. If EVA achievement falls short of the target by a certain stipulated percentage, the target bonus is shaved by that amount. A greater shortfall generally means no bonus at all. And, if theres a decline in EVA, accrued bonuses that employees have received will be debited from the bonus bank. With this system, some of managements prior earnings are always at risk, which tends to squelch any impulse to inflate one years results at the expense of the future. For the top tier of executives, leveraged stock options (LSOs) are an additional incentive. Under this plan, a portion of the annual bonus is distributed in the form of stock options (more than would normally be available at the price). But, unlike normal options, LSOs can only be exercised at ever-higher prices, year by year. This ensures that executives cannot be enriched by options unless stockholders are equally enriched by rising share prices. Chapter Ten: How EVA Can Fail One primary cause of EVA failure is the lack, or perceived lack, of full support from the CEO. Thus, the chief executive must lead the charge by chairing the steering committee, not as a referee, but as the champion of the program, coordinating discussions, resolving conflicts, and enforcing the timetable for implementation. Failure will also ensue if a companys top executives are being overpaid for poor performance and/or if they are of mediocre talent. If they are being paid exorbitant salaries, despite poor performance, they are likely to earn less under an EVA bonus plan. And, success will be elusive if existing executive talent is incapable of effecting substantive improvement in performance. However a far more common cause of failure is an incompatible corporate culture, characteristic of a rigid bureaucracy. In these organizations, jobs are often sinecures, and promotions are dependent on seniority rather than merit. In this kind of setting, employees are unaccustomed to variable pay, unless it is negotiated, and they do not look forward to being objectively measured by EVAs rigorous standards. An EVA incentive plan provides strong motivation for growth combined with capital discipline. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 7 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved Chapter Eleven: New FrontiersReal Options and Forward-Looking EVA The relatively new concept of real options can be used in all industries but is vital in the oil, gas, and other extractive industries because much of the market capitalization of these companies is represented by the developed and undeveloped reserves they own below ground. The problem is that the upstream operationsexploration and production (E&P) present a problem for standard EVA measurement. However, forward-looking EVA adds the enhanced (or reduced, if prices decline) value of a companys reserves to the firms NOPAT. It is an adjustment that recognizes current market credit for future value. It also provides a realistic incentive system. Annual increases in capital because of oil, gas, or mineral strikes are included in NOPAT, thus, greatly boosting managerial rewards. Chapter Twelve: 25 Questions Over the years, a variety of questions have arisen about EVAs theoretical principles and its practical applications. The following is a sampling: Why are companies in the private sector, as well as state-owned enterprises, turning to economic profit as a measure of performance? What determines how broadly and how deeply EVA is deployed in an organization? Does the type of remuneration drive investment decisions? How is the task of investor relations altered by employing an EVA framework? Is it true that efforts required to introduce EVA have been underestimated and insufficiently stressed? What can be inferred from the fact that most EVA companies have adopted additional criteria for bonus evaluation? What happens when companies attempt to balance the effect on EPS and pay the bonus? What can be done about dysfunctional behavior between departments when someones EVA is threatened by someone elses proposal? How linked has EVA been with the development of a Balanced Scorecardwas it a help or a hindrance? What have been the effects of EVA on the culture and behavior of businesses? How easy is it for individuals who do not have well-developed business and financial acumen to grasp the concept of EVA? Chapter Thirteen: Recipe for Success Successfully implementing value-added change in an organization requires six key factors. First, the company must have a workable business strategy and appropriate organizational structure before EVA can have a salutary effect on performance. Second, in order for EVAs full potential to be achieved, a company must install a measurement system, a management system, and an incentive systemall of EVAs components. Third, an EVA incentive plan is essential, and it must reach as far down into the organization as possible. Fourth, a comprehensive training program is as essential as the incentive plan. Fifth, the EVA program must have the full and enthusiastic backing of the CEO. And, sixth the CFO and/or controller must be equally committed. Epilogue: EVA and the New Economy * * * A subject index is provided. Remarks Oftentimes, senior management seems to forget that its most important job is to maximize a companys current market value in order to reward its shareholders (the companys owners) and, by extension, the firms other stakeholders and society at large. However, according to Stern and Shiely, this all-important quest for value is being deterred by obsolete accounting systems that emphasize the wrong financial goals and the wrong performance and valuation measures. This emphasis on the wrong goals and measures also allows executives and managers to be improperly compensated for their efforts. The EVA Challenge explains that the cure for this malaise is Economic Value Added (EVA), and it outlines how to implement an EVA program and integrate it into strategy development, organizational design, training, and incentive compensation. EVA was developed by the consulting firm, Stern Stewart & Co. (Stern is a cofounder), after years of experience advising clients on valuations, restructurings EVA is such a radical departure that it requires unremitting pressure from the top to enforce compliance in the echelons below. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 8 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved and recapitalizations, acquisitions and divestitures, and management incentive compensation plans. (In 1991, Stern and G. Bennett Stewart, III published The Quest for Value, in which they detail the what and why of EVA.) Thus, The EVA Challenge can be considered Quest for Value, Part II, for it details the how. Using company- specific initiatives and case examples, the work shows senior management, key operating people, and planning and financial staff how to customize and implement EVA. And, it provides a practical framework that this audience can use to set goals, allocate resources, develop strategy, valuate acquisitions, set financial policy, train the troops, plan a fair incentive compensation system, and build shareholder value. Although many different companies and types of businesses are used to provide insight into the practical aspects of EVA implementation, the work focuses on Briggs & Strattons (an old-line company and producer of air-cooled gasoline engines)some of the models presented are those developed by Briggs & Strattonand also gives a lot of attention to Herman Miller, the furniture manufacturer. Nonetheless, the authors make a strong case for EVAs relevance to new-economy companies, taking great pains to address the e-commerce situation in which many companies do not even have profits, let alone enough to cover a capital charge. The authors are also staunch advocates for the shareholder, fervently adhering to the view that focusing on the maximization of shareholder value simultaneously maximizes the wealth of society, including such stakeholders as labor, suppliers, customers, and the community at large. They see no conflict of interests and make a credible case for this viewa case that also provides a solid framework for a broad range of corporate decision- making. Thus, companies struggling to balance the needs of investors, with the need to reach informed decisions regarding effective business strategy, will find The EVA Challenge invaluable. Reading Suggestions Reading Time: 8 to 10 hours, 240 Pages in Book The authors insist that EVA is simple and easy enough for nonfinancial types to grasp and apply; however, the truth of that assertion depends on what is meant by nonfinancial types. Noone does not need to be an accounting/finance professional, but we believe that it is necessary at least to have some rudimentary knowledge of these principles if one is to have more than just a cursory understanding of the general premise behind EVA. If the details of EVA are new to you, or you dont have the requisite accounting/finance knowledge, we suggest that you spend some time with The Quest for Value. We also suggest that you begin The EVA Challenge with Chapter Twelve: 25 Questions and Chapter Thirteen: Recipe for Success. The responses to the questions repeat much of the contents of the book (as does the information in the thirteenth chapter), but do so in a more accessible manner. If you are familiar with the EVA concept, and are considering implementing the program, you can choose only those chapters that address your particular concerns. However, you should also make a point of reading the two chapters mentioned. We also recommend that everyone read the epilogue. One last caveat: The work presents an extensive review of the literature. Incomprehensively, however, no bibliographic notes and/or bibliography are provided. If you wish to explore these resources further, it will be a difficult undertaking, because they only appear as in-text citations. Moreover, these many, full citations are cumbersome and might greatly impede your momentum. Joel M. Stern and John S. Shiely, with Irwin Ross The EVA Challenge Page 9 Business Book Review Vol. 18, No. 13 Copyright 2001 Business Book Review, LLC All Rights Reserved Continue to Enjoy Business Book Review. Remain current with best practices in business, and learn from the biographies of the people and companies shaping business today. Subscribe to BBR and receive 40 quality reviews via convenient email links throughout the year. A Note to Our Readers We at BBR encourage our readers to purchase the business books we review. BBR Reviews are intended as a service to busy professionals, as we recommend only those books that are worth your time to read in their entirety. 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