FINANCE

61

TABLE 1

WINNERS IN THE 2019 FCT RANKINGS INDUSTRY

FCT aw a r d

Technology, Hardware Storage & Peripherals

Entertainment

Multiline Retail

Pharmaceuticals

Textiles, Apparel & Luxury Goods

Household Products

Speciality Retail

Machinery

Company

Production Cy c l e T im e (P C T ) – d a y s

Financial Cy c l e T i m e (FCT) – days

I n v e s t ed C a p i t a l Per D a y –U S$

Gold

NetApp

54

(51)

16

Silver

Dell Technologies

(8)

(8)

248

Bronze

HP

(57)

0

160

Gold

Netflix

(14)

(21)

43

Silver

Activision Blizzard

10

56

21

Bronze

Electronic Arts

5

56

14

Gold

Magazine Luiza

9

66

11

Silver

Wesfarmers

44

116

260

Bronze

Nordstrom

92

139

43

Gold

Pfizer

126

49

147

Silver

Johnson & Johnson

51

89

224

Bronze

Allergan

15

93

43

Gold

VF

72

122

32

Silver

Puma

74

132

11

Bronze

Nike

77

144

100

Gold

Reckitt Benckiser

4

63

27

Silver

Church & Dwight Co

61

76

11

Bronze

Clorox Company

66

82

17

Gold

Dufry

32

63

24

Silver

Best Buy

19

36

117

Bronze

Fnac Darty

3

21

18

Gold

Paccar

22

41

64

Silver

Stanley Black & Decker

62

46

38

Bronze

Meritor

71

55

11

Production Cycle Time: PCT represents the number of days it takes for a dollar of core invested capital to result in a dollar of sales. Financial Cycle Time: FCT represents the number of days it takes to turn a dollar of operating investment including leases into a dollar of sales. Note that some companies, e.g. Netflix, are paid in advance and have negative FCT. Invested Capital Per Day: this figure indicates how many dollars of cash are tied up for each day of FCT.

enterprise”. Like RB, Black & Decker seeks out smaller companies with fresh ideas, describing its Accelerator as “a frequent, key collaborator on projects to invent and bring to market digitally-driven, world’s-first solutions”. It also hosts an internal portal to tap the ingenuity of its workforce. Called the Drawing Board, the portal crowdsources “inventive ideas from all the people of Stanley Black & Decker”. Or consider VF Corporation, with an FCT of 79 days compared to its nearest competitor at 88 days. The name might not be familiar, but if you’ve ever donned a pair of Dickies workpants, Vans or Timberland shoes, or a jacket from The North Face, you’ve bought from VF.

One of their strengths has been in encouraging innovation through their supply chain. By bringing designers, technical specialists and manufacturers together in dedicated innovation centres to enable close collaboration, new ideas have been encouraged in a competitive market. Congratulations to all the 2019 winners. Their successes show that any company can stay fast and nimble when it’s focused on the future. — Joe Perfetti teaches equity analysis at the University of Maryland and is an innovation fellow with Duke Corporate Education. Noah Miller and Kush Patel assisted in the research. Download all the rankings at: www.dukece.com/downloadresults-supporting-resources Q4 2019 Dialogue