True Profitability

How can managers make the most of the vast combination of products and customers in their portfolios while curtailing harmful complexity? "Masters of Complexity" know how to use the "long tail" of product diversification to attract new clients and boost sales, without falling into chaos. In this book, we have tried to capture the unique methods and approaches used by Masters of Complexity to carry extreme numbers of products and services in their offerings, gaining new customers, and growing True Profitability.True Profitability is the real measure of a company's economic success. It's pure profit devoid of arbitrary allocations or interpretations created by conventional accounting systems. It starts with the contribution margin and ends with the free cash generated. Said differently, True Profitability is "money in the pocket." Moreover, contribution margin is a metric to start with, as it represents a clean ratio between price, which is defined by the market, and direct cost, which is achieved by the company's capabilities. It's the purest indicator of economic performance and value that we can find in a business. Everything else is abstraction and convention.