Create More Value

Greg Milano explains how the status quo in incentive target-setting unintentionally leads to destructive behaviors and decisions. From asymmetric risk exposure to a myopic focus on variances to “sandbagging,” typical corporate goal-setting and planning processes incentivize mediocrity and time-consuming target negotiations. Alternatively, setting ambitious, stretch targets can spur significant new sources of value creation. By emphasizing improvement over prior results, deploying incentives that are truly aligned with TSR, and adopting a structured process for setting challenging, yet achievable, goals, organizations can foster more growth and innovation. When managers are rewarded for thinking outside the box, the result is an ownership culture where leaders are always seeking the next catalyst for growth and outperformance.

Expert in the economics of organizations, Professor Richard Langlois, joins us to explore how and why firms decide between internal production and market transactions. Drawing on Ronald Coase’s foundational theory of transaction costs, Langlois explains that companies “make or buy” based on which option is less costly and more effective, a question that underpins the broader structure of firms, ownership models, and vertical integration. He argues that the dominance of large, vertically integrated corporations in the mid-20th century was less about inherent superiority and more a response to poorly functioning markets during the Great Depression, World War II, and heavy financial regulation. As markets—especially capital markets—improved through deregulation, many conglomerates unwound in what Langlois calls the “vanishing hand,” a shift back toward market coordination and specialization. The conversation also examines why today’s tech giants like Amazon and Apple succeed with integration, attributing it to scale, platform dynamics, modularity, and fine-tuning advantages rather than old-style conglomerate logic. Langlois further discusses innovation, the debate over whether transformative breakthroughs are slowing, and the importance of organizational knowledge and capabilities as the foundation for growth. The episode highlights how firms must strategically balance integration, outsourcing, and core competencies in a constantly evolving market environment.

Karl Pichler, CFO of Sourceability Global Holdings and former CFO of Rackspace, shares insights from more than 25 years as a public company executive, investor, and educator. We discuss Karl’s evolution from corporate finance expert to enterprise leader, covering his role in scaling Rackspace from $80 million in revenue to over $2 billion, through an IPO and eventual sale to Apollo Global Management. This episode features a practical discussion of capital allocation and value measurement best practices—exposing the limitations of EBITDA and ROIC—and discussing how corporate leaders can truly balance growth and return on capital to optimize long-term value creation.

J. Michael Bruff, CFO of Envision Healthcare and a veteran finance and operating executive, joins us to discuss the core attributes of effective CFOs. We discuss internal controls, Michael’s broad functional and operational experience, and the importance of a deep understanding of how financial statements work together to drive lasting value. Michael shares insights from his time at Varian Medical Systems, where the company shifted its capital allocation priorities from buybacks to life-saving R&D, ultimately quadrupling its compounded revenue growth rate and nearly doubling its share price in just three years. The conversation covers how value-based incentive and allocation frameworks lead to agile and disciplined decision-making. This episode offers practical guidance for leaders seeking to improve capital allocation, strategic clarity, and value creation.

Fortuna partners Greg Milano and Marwaan Karame explore how an ownership culture fuels long-term shareholder returns in the final instalment of a five-part series on economic-profit-based value management. The discussion centers around an updated take on economic profit that shows a stronger relationship to shareholder returns, known as Residual Cash Earnings (RCE). By focusing on RCE, companies gain better insights into where value is created or destroyed, enabling smarter resource allocation and incentive compensation. The episode explains how this value management approach fosters five key traits of an ownership culture, as illustrated through real world case studies featuring corporate clients. This conversation offers valuable lessons for executives, investors, and business leaders aiming to enhance decision-making and build a true ownership culture within their organizations.

Expert in pricing strategy and value-based management, Patrick Furtaw, joins the podcast. Patrick shares insights from his background in strategy, corporate finance, and organizational change, explaining why pricing is one of the most powerful levers for driving shareholder value. The conversation covers common pitfalls such as overreliance on cost-plus pricing, insufficient executive ownership, and misaligned sales incentives, while highlighting solutions like value-based pricing, price realization metrics, and smarter sales compensation structures. We also explore the rise of subscription and outcome-based models across industries, with examples from tech companies, John Deere, and Caterpillar, as well as lessons from Amazon’s approach to price testing. The discussion reinforces a simple but critical truth: customers don’t buy your costs—they buy your value.

Valuation expert, author, and leader of McKinsey & Company’s strategy and corporate finance practice, Tim Koller, joins the podcast. Greg and Tim explore the critical drivers of long-term value creation, the risks of short-termism, and the essential role of CEOs and CFOs in overriding human and organizational bias to drive optimal corporate strategy. We cover the importance of granular resource allocation, organizational biases like inertia and groupthink, and the process-based discipline and data needed to sustain value creation. The discussion also covers the role of artificial intelligence in business—distinguishing between its potential as a tool for efficiency versus an enabler of competitive advantage. 

Valuation expert, author, and leader of McKinsey & Company’s strategy and corporate finance practice, Tim Koller, joins the podcast. Greg and Tim explore the critical drivers of long-term value creation, the risks of short-termism, and the essential role of CEOs and CFOs in overriding human and organizational bias to drive optimal corporate strategy. We cover the importance of granular resource allocation, organizational biases like inertia and groupthink, and the process-based discipline and data needed to sustain value creation. The discussion also covers the role of artificial intelligence in business—distinguishing between its potential as a tool for efficiency versus an enabler of competitive advantage. 

Most incentive plans fail to drive true value creation—they reward mediocrity, encourage short-term thinking, and reward sandbagging and gaming of the system. In the fourth instalment of a LinkedIn Live series, Fortuna partners Greg Milano and Marwan Karame share a better incentive compensation design using a modern take on economic profit: Residual Cash Earnings. We cover why traditional bonus plans fall short, the key traits of an ownership culture, and how true value-based incentives align management’s interests with those of long-term investors. We also feature real-world examples and simulations that demonstrate why this approach is so effective at creating an ownership culture at large public companies.

Consider a hypothetical company in 2012 with two business units—Amazon and Walmart. Our latest episode considers the question: which business would you rather own and prioritize reinvestment in? Traditional financial metrics would have made Walmart look like the obvious winner—profitable, disciplined, and cash-rich. But what happens if you use a modern economic-profit lens to value these disparate business models? This thought experiment explains why so many high-growth, high-potential businesses get starved of capital at large, public companies that rely on outdated metrics to allocate resources. How you measure matters.

This podcast features the third installment of our LinkedIn Live series on how economic profit drives long-term value creation. Fortuna partners Greg Milano and Marwaan Karame discuss strategic resource allocation: how companies can better allocate capital and other resources to unlock more shareholder value. They explore common pitfalls like erroneous objectives, lack of focus, and decision paralysis that lead firms to invest in value-destroying projects while underinvesting in their best growth opportunities. Through real client case studies, they explain how residual cash earnings, a modern, cash-based economic profit measure helps leaders identify where value is truly created across business units, segments, and products—even down to the SKU level. The episode emphasizes the importance of a fact-based, focused approach to investment decision-making. 

Dan Sansone, former CFO of Vulcan Materials Company, joins the podcast to share how EVA focused forecasting, planning, and incentives on a singular goal of value creation. Drawing on nearly three decades at Vulcan and as a board member, the conversation covers why traditional lookbacks often stifle investment, why rolling targets and economic profit improve accountability, and the importance of designing consistent, transparent incentives that foster an ownership mindset. This episode can help corporate leaders seeking to embed a value framework into everyday business decisions.

Valuation virtuoso, Michael Mauboussin, joins us to explore the core drivers of long-term value creation. We explore how valuation multiples are often misleading, why the rise of intangible assets requires new valuation frameworks, and how investors and corporate managers alike can better evaluate strategy and competitive advantage. We cover practical frameworks on capital allocation, sustainable competitive advantage, and why truly understanding economic fundamentals is key to avoiding “value traps.” This episode is a must-listen for finance professionals, executives, and serious investors. Michael is Head of Consilient Research at Counterpoint Global, a Morgan Stanley Investment Management fund and a finance professor at Columbia Business School.

Joe Milam, founder of AngelSpan and The Legacy Funds, joins the podcast to discuss how behavioral finance principles improve decision-making for corporate managers and investors alike. Milam critiques the current chaotic, informal funding environment for startups and introduces his Venture TAMP platform, which applies disciplined public-market strategies—like the Kelly Criterion and standardized reporting—to early-stage investing. He emphasizes reducing bias, improving transparency, and optimizing capital allocation to support innovation. The conversation spans topics like barriers to corporate innovation, portfolio theory, and how data-driven decision-making often outperforms human intuition in venture and public markets alike.

Fortuna partners Greg Milano and Marwaan Karame highlight how economic profit (EP) drives superior decision-making, cultural alignment, and, ultimately, value creation. Unlike traditional metrics like ROIC or EBITDA margin, EP reflects the true value a company creates—profit earned above the cost of capital. Their research shows that companies embedding EP into planning, decision-making, and incentives outperform the market by 7% annually. Real-world examples, such as Kimball Electronics and Varian Medical Systems, illustrate how adopting EP can trigger profitable growth, foster an ownership mindset, and lead to better capital allocation and portfolio optimization decisions. EP encourages better behaviors like smart spending and risk-taking, focused prioritization, and long-term thinking. 

“From the shop floor to the top floor,” Kimball Electronics employees are laser-focused on economic profit.  Kimball CFO, Jana Croom, discusses the transformative impact of the measure on business performance and how it aligns the team on a shared goal of value creation. Jana explains how economic profit provides a comprehensive view of financial health and aligns decision-making and strategy across all levels of the organization. We cover Kimball’s use of EVA in planning, compensation, and operational execution, including practical examples like inventory management and capital investment. Jana also shares insights on navigating market volatility, balancing capital efficiency, and why it’s important for CFOs to lead well beyond the finance department. This episode offers valuable takeaways for finance leaders and executives seeking to sharpen their team’s strategic focus and embrace a value-oriented ownership culture.

CEO, Ryan Barker, and Chief Strategy Officer, Ken Favaro, of BERA Brand Management explore how brand management strategies intersect with activist investor pressures. They discuss how Bera’s AI-powered platform equips businesses with real-time, predictive brand data that connects brand equity directly to financial outcomes. Using examples like Heinz and Barbie, the conversation highlights how companies can defend and optimize brand investments—especially under activist scrutiny. The takeaway? Treat brand as an asset, measure it with financial rigor, and use data to drive ROI, relevance, and pricing power in a competitive landscape.

AnnaMaria shares insights from her leadership roles in some of the most significant mergers and transformations in recent history—including Pfizer-Wyeth and DowDuPont, and XPO Logistics. She discusses how strong leadership, clear communication, and a robust value creation thesis are critical for successful mergers. The conversation also explores the evolving role of communications in driving growth, managing risk, and building reputation as a core business asset. AnnaMaria DeSalva is also a seasoned leader in strategic communications and corporate transformation. From 2017 – 2024, DeSalva served on the board of XPO Logistics, becoming Vice Chairman in 2019, and played a key role in board engagement, strategy, CEO succession, and governance during XPO’s transformation. Currently, AnnaMaria is Global Chairman of the Burson Group, a leading communications firm focused on creating value through reputation. From 2019 to 2024, she was Global Chairman and CEO of Hill & Knowlton Strategies. Previously, she was Chief Communications Officer at DuPont and a senior advisor to DowDuPont CEO Ed Breen during the company’s historic split into independent public companies. Earlier in her career, she also held leadership roles at Pfizer, Bristol Myers Squibb, and GCI Group.

Greg Milano discusses how annual incentives can drive better corporate behavior. He highlights common flaws in traditional incentive plans, such as incomplete metrics, the time-consuming and counterproductive negotiation and gaming of targets, and ineffective payout structures. Milano advocates for a value-management approach using a cash-based measure of economic profit that reliably reflects shareholder value creation. Milano’s preferred economic profit measure, Residual Cash Earnings (RCE), was developed to encourage profitable investment, reduce financial manipulation, and simplify incentive structures by measuring against the prior year rather than the plan. Complete measures like RCE not only restore sanity to planning and target-setting—they unite the team on a shared goal of value creation by helping management pinpoint its most promising strategy, capital allocation, and portfolio optimization opportunities, even across complex businesses. Indeed, research shows companies that use economic profit measures like RCE outperform the market by 7% annually, as they are able to target and sustain TSR improvement.  

Dave Peacock, CEO of Advantage Solutions, discusses the bold transformation he is leading to create more value at Advantage—turning a fragmented business into a focused provider of solutions that improve the velocity of commerce, helping brands get the right products on the right shelves and helping retailers more efficiently convert shoppers to buyers. Facing structural changes and secular challenges, we discuss lessons learned in his three decades of experience, including his tenure as President of Anheuser-Busch during its acquisition by InBev and working with 3G Capital to drive efficiency while preserving top-line results with brand investment and pricing power. He also shares how his early education in journalism and economics helped shape his perspective as a leader in evaluating and communicating the commercial opportunity ahead.