Question: Actually, I agree with one thing you said a while ago, and that related to the desirability of making financial analyses on a threshold basis.

"Actually, I agree with one thing you said a while ago, and that related to the desirability of making financial analyses on a threshold basis. I realize how many unknowns there are in the new products business. As a president, I realize too that most of the financial projections I read are just air. If a new products group can convince me that they can sell at least X volume, and at that volume their costs will be Y, or lower, then I am inclined to go along with them. But, deep in my heart, I don't like it--those thresholds are just as much subject to manipulation as are the more structured NPV projections."

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I agree that thresholds can be manipulated Few things escape this criticism given that almost nothin... View full answer

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