Finance/ / Paper by Essay Investing Business

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Jack Stack’s vision of a long
-term sustainability of any business is rooted in
company’s ability to face its weaknesses and imperfections, in order to tackle them properly.
In accordance to his position, it is crucial to pay attention to the company’s fin
ancial rations,
comparing them to the corresponding figures of
 competitors. Such approach allows a
 business team to concentrate on the areas that are in need of rehabilitation and support. The
lowest ratio appears to be a critical number of the compa
ny, an indicator of company’s
insufficient performance in the particular branch.
The author underlines the significance of such approach to managing any business
organization and maintaining the growth of its effectiveness and productivity.
 philosophy behind such ratio-oriented development should be grounded on
interest to place their focus on the improvement of the certain area of the business, which is
lacking appropriate
time, attention and treatment: “Our philosophy from the very

has been that if you are trying to get your employees to think like owners, you should make it
fun and make sure there’s something in it for them (that’s why we call
it the Great Game of
Business)” (Stack, J., 2010).
Despite the fact that such tactic is referred to as the game, it is necessary to create
interdependency between employees’ contribution into the increase of an earlier 
-decided area
of business and continuous company’s well
-being, and its ability to initiate and maintain a
certain “bonus program, profit sharing or variable compensation plan” (Stack, J., 2010).
Mr. Stack supports his arguments with the real-life experience of his own company, who is
concentrating its efforts on the improvement
of the business’s cash flow.
All in all, a critical
number becomes an incentive that pre-determines the direction in which the company will be
moving in the nearest future.
Ratio analysis is quite important for those, who are working for the company, whose
financial ratios they are analyzing, as well as for those, who are seriously considering making