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Global Innovations

Measuring Leadership

PowerRank: Business Clout Leadership Rankings – October 27, 2012 Do you know where you rank and why it matters?

October 27, 2012

www.global–innovation.com


Global Innovations

Measuring Leadership

ASK YOURSELF?  What is leadership?  How is leadership measured?  What tools are available to measure leadership?  How do you compare with competitors?  Are your leaders viewed as a strength or weakness?

1. WHAT IS LEADERSHIP? Leadership is a complex process of social influence in which one person can enlist the aid and support of others in the accomplishment of a common task.

“Leadership: The art of getting someone else to do something you want done because he wants to do it.” Dwight D. Eisenhower “No man is good enough to govern another man without that other's consent.” Abraham Lincoln “A leader is a dealer in hope.” Napoleon Bonaparte "In God we trust; all others must bring data." W. Edwards Deming

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Global Innovations

Measuring Leadership

2. HOW IS LEADERSHIP MEASURED? Leadership is complex process of social influence to accomplish a common task. Measuring leadership requires tracking and monitoring various “hard” (quantitative) and “soft” (qualitative) factors. The mix of these factors depends on the individual business, industry, geography, and position.

3. WHAT TOOLS ARE AVAILABLE TO MEASURE LEADERSHIP? PowerRank is an analytical tool designed to identify and evaluate business leaders based on their economic, leadership, education, and network influence.    

Economics: What assets and resources do you influence? Leadership: What management and leadership roles have you held? Academics: What are your academic achievements? Network: How broad is your business network?

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Global Innovations

Measuring Leadership

PowerRank assigns a numerical weighting to each executive according to his or her relative influence and importance in the measurement group.

PowerRank is broad, deep, verified information, with time trending, all import component of evaluation the influence and relevance of a leader and their organization.    

Data Source: Public company information and information provide by companies and leaders about themselves Comparisons: All companies in the major market indexes, including the S&P 500 Coverage: Over 800,000 leaders from over 100,000+ companies serving 150+ industries in 100+ countries Trending Period: Three years of historical information by quarter

PowerRank is a number ranging from zero to 100 (highest). It represents where an individual, company or organization ranks within a group.

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Global Innovations

Measuring Leadership

4. HOW DOES YOUR LEADERHIP COMPARE WITH COMPETITION? Companies, executives and investors compare many different measures to history, plan (budget, forecasts and projections) and against external benchmarks like industry averages and competition. Common measurements include:    

Market Share and Ratings (e.g., Nielsen Ratings) Revenue, Profitability and Assets (e.g., Moody’s Rating) Productivity, Quality and Speed (e.g., ISO 9000) Innovation and Awards (e.g., Forbes Most Innovative Companies)

Competition, leadership and measurements are well documented. Relatively little information is available on competitive leadership measurements. Following are the number of results from a resent Google key word search:

1. Competitive

659 million (100%)

2. Leadership

588 million (89%)

3. Measurement

354 million (53%)

4. Competitive Leadership Measurement

13 million

( 2%)

PowerRank is an independent, quantitative measurement of leadership. It can be used to compare one company with another and one leadership group with another.

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Global Innovations

Measuring Leadership

5. ARE YOUR LEADERS VIEWED AS A STRENGTH OR WEAKNESS BY THE FINANCIAL MARKETS?  High PowerRank scores are indicative of good business performance. Lower scores indicate that the management and leadership teams have less leadership experience than their peers. 

We analyzed the stock market performance over the last five and ten year for companies with an average PowerRank score above 90 (the top decile performers) and for those with an average PowerRank score below 50 (the lowest half).

The analysis shows that the better managed companies significantly outperform the market indexes over a ten year period. It also shows that weak companies underperformed the market indexes by a significant amount during the previous five years of financial turmoil.

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Global Innovations

Measuring Leadership

Below is an index of the companies led by the top 500 Power Ranked executives as of October 27, 2012. A list of the top 20 Power Ranked executives is on the next page. The PowerRank 500 outperformed the S&P 500 by over 400% over the past 10 years.

PowerRank 500 Led Companies Outperform the S&P 500 over 10 years 600.00%

PowerRank 500 Company Index

500.00% 400.00% 300.00% 200.00% 100.00%

+400% S&P 500 Company Index

0.00% -100.00%

Data Source: Stand & Poor’s. PowerRank 500 index calculated based on equal weighting of component companies. PowerRank 500 = The 500 companies that the top ranked business leaders manage. S&P 500 = The Standard and Poor’s index of 500 companies

Leadership can be measured through PowerRank. Better leadership results in better performance.

Contact: George Bickerstaff for more information (George@global-innovation.com)

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Global Innovations

Measuring Leadership

Comparison stock market index charts of PowerRank 500 companies versus S&P 500 companies over different periods ended October 27, 2012 are shown below. Companies managed by executives and boards with high PowerRank scores outperform market averages, particularly in periods of economic crisis.

One Month Comparison

One Year Comparison

PowerRank of -1.2% vs. S&P of -3.0% PowerRank Outperformed the S&P by 1.8 percentage points

PowerRank of 11.7% vs. S&P of 12.7% S&P Outperformed PowerRank by 1.0 percentage points

Three Year Comparison

Five Year Comparison

PowerRank of 37.5% vs. S&P of 32.4% PowerRank Outperformed the S&P by 5.1 percentage points

PowerRank of 17.3% vs. S&P of -6.7% PowerRank Outperformed the S&P by 24.0 percentage points

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Global Innovations

Measuring Leadership

The top 500 PowerRank executives include 216 (43%) executives who lead S&P 500 companies which are mostly located in North America and Europe. The PowerRank 500 executives are more global and with a more balanced sector mix then the S&P 500 company leaders. Leadership and geographic coverage and experiences are key attributes factored into calculating a PowerRank score. This diversification has helped in business performance.

PowerRank 500 Market Capitalization by Region

PowerRank 500 Market Capitalization by Sector

Average Company Market Capitalization of $2.48 billion

Average Company Market Capitalization of $1.27 billion

S&P 500 Market Capitalization by Region

S&P 500 Market Capitalization by Sector

Average Company Market Capitalization of $4.48 billion

Average Company Market Capitalization of $1.34 billion

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Global Innovations

Measuring Leadership

The Top 20 Power Ranked leaders as of October 27, 2012. These leaders are included in the PowerRank 500 index chart on the prior page.

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Global Innovations

Measuring Leadership

About Global Innovations

Global Innovations  Super incubator  Blend ideas, money and people  Employ teams, technology and networks  Diverse and experienced leadership

Unique Model  Build great new businesses  Drive Innovations that matter  Create new leadership roles  Employ best technologies  Leverage social media

Contact Information George Bickerstaff

Rana Arefieg

Founder and Executive Chairman

Founder and President

george@global-innovation.com (c) +1.203.570.0478

rana@global-innovation.com (c) +1.914.588.1213

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PowerRank - Measuring Leadership