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Equity and loan financing for the smaller company
from cover to cover, and judgement on their usefulness is usually coloured by the personal needs of the reviewer. This new directory has two parts. The first provides lists of organizations in the U.K. and Europe which are involved in corporate or economic planning, and personal details of key personnel engaged in this function. It is not a ‘Who’s Who’ of the planning world, but certainly has a lot to offer any one selling goods ot services to corporate planners, or conducting research into corporate planning practice. 1 suspect that it has less benefit for the practising corporate planner himself. The second part provides information and educational data, giving details of courses and seminars, relevant journals, and abstracts of key articles. For anyone needing information of this type, the directory has much to recommend it. The abstract of key articles contains short summaries of two hundred papers on economic and corporate planning: it is not meant to be comprehensive as the Society for Long Range Pianning’s bibliography, but for some the reduction of the literature to a concise selection nay be an advantage. The directory is well supported by an introductory article by Peter Baynes, former Director 0’ the Society for Long Range Planning. For those who need the information it contains this directory is a useful source of data. My main personal criticism concerns the method of printing used, which resembles typing and aithough easy to read makes the book more bulky than would otherwise have been the case. D. E. HLJSSEY Otis Ltd. London
E:quity and Loan Financing for the Smaller Company, by MICHAEL SPRINGMAN, Gower Press, London (1973) 339 pp. f6.00 (hardback). In this book Michael Springman has not written as the title might suggest, a primer on how private companies should be financed. Rather has he produced a comprehensive text b.ook dealing with all things touching on the obtaining of long term equity and loan finance f:om Merchant Banks and other financial institutions providing development capital. The author, who spent 5 years with Hambro’s Bank, ranges widely over the area and deals in separate chapters on what the financing institution’s objectives are in selecting an investment, how it assesses a company and why applications are turned down; how the company should prepare itself for presentation to the institution and how to conduct the initial negotiations. Further chapters deal with the provisions of the formal agreement between the financing institution and the company’s shareholders, the terms of loan finance, and the all important question of valuation of the company by the institution and its relations with the directors. Lastly Mr. Springman considers how the c:ompany can expect the institution to monitor its investment once made and has some wise advice on the advantages and pitfalls of ‘going public’ or merging. At the end is a useful check list of the principal City sources of development capital and the general criteria they apply. The author’s text book style is perhaps not ideally readable and one hopes that in a commendable wish to produce a comprehensive review of the subject he will not lose the audience who could be expected most to benefit from it: up-and-coming private company managements.
FEBRUARY,
1974
Certainly it should be required reading for them --especially those responsible for corporate finance within the area of Corporate Long Range Planning-for their professional advisers and even for some of the less well organized finance providing institutions who might blush to see so clearly set out what their aims and objectives ought to be. But then Mr. Springman was reared in a first class stable. DAVID BUCKS Samuel Montagu London
Ltd.
Top Team Planning, by PAMELARAMSDEN,Cassell, London (1973), 262 pp. f5 (hardback). The central thesis of this book is that strengths and weaknesses of individuals may be objectively measured by observing physical movements involving oral expression, so enabling the stock of managerial talent in an organization to be systematically analysed and controlled. This very specific technique is linked to broader concepts of corporate development and survival by a stated assumption that managers to a large extent create their own operating environment, and by the use of the technique to assess the overall balance of managerial skills possessed by a ‘top (management) team’. The book analyses managerial activity into 12 elements or ‘action motivators’ towards the performance of which individuals are motivated for job satisfaction, different individuals finding greater satisfaction from some elements than others and thus developing strengths in these areas. The extent to which the indivdual concentrates on each element is measured by observing and analysing non-verbal movements (gestures and the like). This is claimed to be objective, and enables a unique descriptive profile to be constructed for each person. The balance of managerial skills as defined by the 12 elements, possessed by a management group or team may then be identified by aggregation and controlled by changing the membership of the group, by introducing complementary skills, by designing systems to supplement the overall balance, and so on. It is this final use of the technique for control purposes which gives rise to the general, but slightly misleading, title, Top Team Planning. Does it work? It must be said at the outset that this is not quackery-and the book puts this across persuasively to the persevering reader. On the other hand, the author herself declares the need for further research, particularly on the link between physical movement as a muscular ‘tension state’ and psychological or motivational states. A firm conclusion at this stage is premature; the apparent success of the technique may in fact be largely due to the perceptiveness of its chief practitioner, a consultant named Warren Lamb, but it would be wrong to dismiss it: its potential is certainly sufficient to warrant continued trial and investigation. The author fails to achieve fully her aim of linking the technique effectively with other streams of behavioural science, although there is a good summary of the various forms of personality assessment currently applied to managerial behaviour. The attempt to relate the book to long range planning, although scant, is of interest. It is happily consistent with the doctrines of manpower specialists who see corporate strategy being constrained more by human factors than by others. In this sense, the
book underplays the potential for a people-based corporate strategy. B. R. MORRIS The Institute of Manpower Sussex
Studies
Capital Investment Appraisal, by IAN W. HARRISON,McGraw-Hill, London (1973), 91 pp. f2.25 (softback). The preface to this book states that its object is to provide the non-specialist manager with a basic understanding of the problems of capital investment appraisal and the techniques that are used to resolve these problems. This it achieves. The book outlines investment appraisal methods, with the main emphasis on DCF techniques, and briefly but usefully covers risk and uncertainty, and company models. It is clearly set out with charts and diagrams and there is a short check list of questions at the end of each chapter, also a brief bibliography. Discussion of the cost of capital and the choice of cut-off rates is somewhat inadequate and there is no coverage of the important question of the relationship of inflation to these rates. Nonetheless this book will serve as a useful introduction to the subject for the non-specialist managers whose work involves their putting forward investment proposals. Equally it could be valuable in junior management training courses. Although it may raise as many questions as it answers, this is more a reflection of the outstanding problems that surround the subject rather than any inadequacy of the publication. Notwithstanding the number of authors in this field the definitive text must await further development of theories that are at present difficult to apply in real life industrial situations. The price of the book is not unreasonable. P. W. BICKERTON Fisons Ltd. London
Technological Forecasting for Decision Making, by JOSEPH P. MARTINO, Elsevier, New York (1972), 750 pp. E16.00 (hardback). “Society today is faced with the prospect of a great deal of technological change; more change within a few years than in all of previously recorded history.” This single sentence quoted from Martin0 alone justifies the obviously enormous task undertaken in preparing this book which is probably the first comprehensive text-book covering both the methodology and the purpose of technological forecasting (TF)-the making of decisions. Less than half the pages concern the methodology of TF, the rest describing the organization and orientation of the forecast to its uses in decision making. All the normal fields of commercial and social (but not military) management are analysed in the context of the value of TF. The structuring of the process to meet the special needs of the decision which is required to be taken in different areas is covered very fully. The basic processes are elucidated from their fundamentals even if a number of sophisticated derivations and some pseudo academic names in current vogue are by-passed. This is a text-book admirably suited for degree level students of TF; each chapter involves a strictly defined subject and is set out to examine, explain and summarize the subject followed by references and a set of problems designed to
67
E:quity and Loan Financing for the Smaller Company, by MICHAEL SPRINGMAN, Gower Press, London (1973) 339 pp. f6.00 (hardback). In this book Michael Springman has not written as the title might suggest, a primer on how private companies should be financed. Rather has he produced a comprehensive text b.ook dealing with all things touching on the obtaining of long term equity and loan finance f:om Merchant Banks and other financial institutions providing development capital. The author, who spent 5 years with Hambro’s Bank, ranges widely over the area and deals in separate chapters on what the financing institution’s objectives are in selecting an investment, how it assesses a company and why applications are turned down; how the company should prepare itself for presentation to the institution and how to conduct the initial negotiations. Further chapters deal with the provisions of the formal agreement between the financing institution and the company’s shareholders, the terms of loan finance, and the all important question of valuation of the company by the institution and its relations with the directors. Lastly Mr. Springman considers how the c:ompany can expect the institution to monitor its investment once made and has some wise advice on the advantages and pitfalls of ‘going public’ or merging. At the end is a useful check list of the principal City sources of development capital and the general criteria they apply. The author’s text book style is perhaps not ideally readable and one hopes that in a commendable wish to produce a comprehensive review of the subject he will not lose the audience who could be expected most to benefit from it: up-and-coming private company managements.
FEBRUARY,
1974
Certainly it should be required reading for them --especially those responsible for corporate finance within the area of Corporate Long Range Planning-for their professional advisers and even for some of the less well organized finance providing institutions who might blush to see so clearly set out what their aims and objectives ought to be. But then Mr. Springman was reared in a first class stable. DAVID BUCKS Samuel Montagu London
Ltd.
Top Team Planning, by PAMELARAMSDEN,Cassell, London (1973), 262 pp. f5 (hardback). The central thesis of this book is that strengths and weaknesses of individuals may be objectively measured by observing physical movements involving oral expression, so enabling the stock of managerial talent in an organization to be systematically analysed and controlled. This very specific technique is linked to broader concepts of corporate development and survival by a stated assumption that managers to a large extent create their own operating environment, and by the use of the technique to assess the overall balance of managerial skills possessed by a ‘top (management) team’. The book analyses managerial activity into 12 elements or ‘action motivators’ towards the performance of which individuals are motivated for job satisfaction, different individuals finding greater satisfaction from some elements than others and thus developing strengths in these areas. The extent to which the indivdual concentrates on each element is measured by observing and analysing non-verbal movements (gestures and the like). This is claimed to be objective, and enables a unique descriptive profile to be constructed for each person. The balance of managerial skills as defined by the 12 elements, possessed by a management group or team may then be identified by aggregation and controlled by changing the membership of the group, by introducing complementary skills, by designing systems to supplement the overall balance, and so on. It is this final use of the technique for control purposes which gives rise to the general, but slightly misleading, title, Top Team Planning. Does it work? It must be said at the outset that this is not quackery-and the book puts this across persuasively to the persevering reader. On the other hand, the author herself declares the need for further research, particularly on the link between physical movement as a muscular ‘tension state’ and psychological or motivational states. A firm conclusion at this stage is premature; the apparent success of the technique may in fact be largely due to the perceptiveness of its chief practitioner, a consultant named Warren Lamb, but it would be wrong to dismiss it: its potential is certainly sufficient to warrant continued trial and investigation. The author fails to achieve fully her aim of linking the technique effectively with other streams of behavioural science, although there is a good summary of the various forms of personality assessment currently applied to managerial behaviour. The attempt to relate the book to long range planning, although scant, is of interest. It is happily consistent with the doctrines of manpower specialists who see corporate strategy being constrained more by human factors than by others. In this sense, the
book underplays the potential for a people-based corporate strategy. B. R. MORRIS The Institute of Manpower Sussex
Studies
Capital Investment Appraisal, by IAN W. HARRISON,McGraw-Hill, London (1973), 91 pp. f2.25 (softback). The preface to this book states that its object is to provide the non-specialist manager with a basic understanding of the problems of capital investment appraisal and the techniques that are used to resolve these problems. This it achieves. The book outlines investment appraisal methods, with the main emphasis on DCF techniques, and briefly but usefully covers risk and uncertainty, and company models. It is clearly set out with charts and diagrams and there is a short check list of questions at the end of each chapter, also a brief bibliography. Discussion of the cost of capital and the choice of cut-off rates is somewhat inadequate and there is no coverage of the important question of the relationship of inflation to these rates. Nonetheless this book will serve as a useful introduction to the subject for the non-specialist managers whose work involves their putting forward investment proposals. Equally it could be valuable in junior management training courses. Although it may raise as many questions as it answers, this is more a reflection of the outstanding problems that surround the subject rather than any inadequacy of the publication. Notwithstanding the number of authors in this field the definitive text must await further development of theories that are at present difficult to apply in real life industrial situations. The price of the book is not unreasonable. P. W. BICKERTON Fisons Ltd. London
Technological Forecasting for Decision Making, by JOSEPH P. MARTINO, Elsevier, New York (1972), 750 pp. E16.00 (hardback). “Society today is faced with the prospect of a great deal of technological change; more change within a few years than in all of previously recorded history.” This single sentence quoted from Martin0 alone justifies the obviously enormous task undertaken in preparing this book which is probably the first comprehensive text-book covering both the methodology and the purpose of technological forecasting (TF)-the making of decisions. Less than half the pages concern the methodology of TF, the rest describing the organization and orientation of the forecast to its uses in decision making. All the normal fields of commercial and social (but not military) management are analysed in the context of the value of TF. The structuring of the process to meet the special needs of the decision which is required to be taken in different areas is covered very fully. The basic processes are elucidated from their fundamentals even if a number of sophisticated derivations and some pseudo academic names in current vogue are by-passed. This is a text-book admirably suited for degree level students of TF; each chapter involves a strictly defined subject and is set out to examine, explain and summarize the subject followed by references and a set of problems designed to
67