"...Return Driven Strategy provides a clear and concise way of looking at the key issues that drive profitable businesses..."

—Samuel C. Scott III
Chairman and CEO, Corn Products International
Board Member of Abbott and Motorola

"...The Return Driven Strategy framework has enabled the senior leadership of our company to establish, implement, and periodically realign, a first class, effective business strategy that produces real results..."

—John J. Mulherin
Chief Executive Officer
The Ziegler Companies, Inc.

If we can better understand how the success or failure of a business is driven by its plans and actions, then we can greatly improve how we run our businesses and value companies.

DRIVEN is about Return Driven Strategy, a framework for business analysis and planning prioritization and the culmination of a ten-year research project studying and categorizing the root causes of thousands of businesses that have succeeded, failed, or remained in mediocrity.

DRIVEN: Business Strategy, Human Actions, and the Creation of Wealth (E-book Edition)

Includes both Kindle, Nook, and iPad versions for your digital reading comfort—regardless of device.

$19.95

The underlying research covers up to 30 or more years of firm performance. DRIVEN includes explanations, diagnostics, and case studies. Chapters are ordered consistently with the Return Driven Strategy framework, making DRIVEN a valuable guide for ongoing reference as well as an interesting and enlightening read.

Helpful Links for Reading eBooks
EPUB File—What It Is and How to Open One
MOBI File—What It Is and How to Open One

About the Framework

Return Driven Strategy™ is a framework that helps leaders to better analyze, understand, and employ the activities that have been shown to produce superior returns and wealth creation.

The Return Driven Strategy framework describes the pattern of strategic activities of high performance companies regardless of industry or geographic location. In our research of over 20,000 companies for 20 years or more of data, this meant a company showed superior performance for 10 consecutive years or more in three performance measures: ROI, Growth and Total Shareholder Returns. About 100 currently publicly-traded Return-Driven companies met this criteria.

The framework is a summary of eleven tenets against a backdrop of a delta symbol, the symbol for change. These represent eleven important activities that lead to wealth creation. The first tenet, at the top of the pyramid, is a commitment to wealth creation itself. The other ten tenets sit below as the means for reaching that highest tenet. The base of the pyramid is made of three foundations. These foundations apply to every tenet in the pyramid.

Very different ideas about what makes a business successful

The following is a sample of the concepts explained in Driven. These often reveal misunderstandings about business strategy that have led many companies to destroy value, or have severely limited the wealth that could have been created.

Businesses with great products are often not great businesses
When to shrink and grow rich – or grow and be poor
Why “first mover advantage” is often anything but
The undeniable financial impact of business ethics on performance
“Being different” is a by-product of great strategy, not a focus
How a monopoly, generally so desired, will cause valuations to stagnate
The difference between a great company and a great stock
The real customer needs are seldom the obvious ones
How treating employees as customers generates higher returns to all constituents
Which is more important, strategy or execution? Both.

Some of these concepts can come as a surprise, but the underlying financial and practical support for them is substantial.

The Return Driven Strategy Pyramid

Of everything that Return Driven Strategy offers to its users, a primary benefit is better resource allocation: the prioritization of time and efforts in planning, analysis, and implementation.

As projects compete for capital, time, and resources, Return Driven Strategy can assist management in choosing and timing the actions that are best poised for achieving the organization’s goals.

Eleven Tenets and Three Foundations combine to form the Return Driven Strategy framework. These appear in pyramid form, in order of importance of priority in long-term performance and valuation impact.

RDS Framework Outline

TENET ONE: Ethically Maximize Wealth

Why operating within the ethical boundaries of communities served -- as those communities would define -- is an absolute must
Why management must define wealth explicitly -- and how to act on it afterwards
Mountains of financial evidence that shows that gross unethical conduct is a business risk that never bears a justifying reward
The most important report you may never have heard of
The right metrics to help management monitor and communicate the business's ability to execute on Tenet One in the future

TENETS TWO AND THREE: Fulfill Otherwise Unmet Customer Needs, and Target Appropriate Customer Groups

Why the path to high-performance and wealth-creation is through the customer –- by fulfilling the unmet needs of lots of customers, in ways no one else can
How to achieve real pricing power for higher returns
How high-performance firms reap the benefits of understanding the psychological reasons behind customer purchases
How to pick the right customer groups to target to maximize wealth-creation

TENETS FOUR, FIVE, AND SIX: Deliver Offerings, Innovate Offerings, and Brand Offerings

How high-performance firms deliver offerings to customers
Proven methods to protect existing markets and expand into new ones
How successful firms create a solid bridge between the customers’ knowledge of the offering and their explicit awareness of their unmet need
Why these three competencies are necessary for driving high returns at any firm and in any industry

TENETS SEVEN THROUGH ELEVEN: Partner Deliberately, Map and Redesign Processes, Engage Employees and Others, Balance Focus and Options, and Communicate Holistically

The five specific types of activities for enhancing the ability to achieve the higher tenets explained
Key metrics to consider before partnering
When and what to map -- and when to redesign
The right offering for the right employee
How to balance exploration with execution
How high return firms create communication strategies

THREE FOUNDATIONS OF BUSINESS STRATEGY: Genuine Assets, Vigilance to Forces of Change, and Disciplined Performance Measurement & Valuation

What Genuine Assets are and how they greatly increase the potential to create unassailable advantages
The three distinct areas where forces of change arise that require close watching
The difference between a great company and a great stock -- and the problems that arise when managers confuse one for the other.

Different Analysis, Different Conclusions

The financial discipline underlying this business strategy research is not inconsequential. Many firms that receive substantial press for being highly admired companies are found to have admirable public relations skills, but less than respectable financial performance.

At times, companies regarded as “great” have in actuality been great turnarounds. Firms like this are worthy of study for how to dig a business out of a hole, but are greatly lacking as cases for high value achievement.

Many businesses don’t receive a lot of press, yet quietly generate cash flow returns that amaze investors. They produce offerings built by engaged employees and partners that are subsequently purchased by customers who voluntarily pay high prices to fulfill their needs in ways they could not otherwise.

People can make better decisions when they understand the connection between business planning, business actions, and wealth-creation. As authors and practitioners, we hope to provide an easy-to-understand, straightforward approach to business planning and evaluation. We respectfully offer Return Driven Strategy.

Testimonials From Business Leaders, Investment
Professionals, and Academia

"...what we as educators and thought leaders should embed in our curricula and teachings in business schools..."

"The principles and concepts in Return Driven Strategy capture what we as educators and thought leaders should embed in our curricula and teachings in business schools throughout our undergraduate, graduate and executive education programs. Business schools must focus on the importance of a firm commitment to ethically create shareholder value.”

—Arthur Kraft, Ph.D
Chairman of the Board, AACSB International
Dean, George L. Argyros School of Business and Economics,
Chapman University

"...Frigo and Litman put it all together for you..."

"Whether your goal is to improve business performance or to make better buy/hold/sell investment decisions, insights are needed to connect core principles of wealth creation to both reported financial performance and firm valuations in the stock market. Frigo and Litman put it all together for you."

—Bartley J. Madden
Author of the books, "CFROI Valuation: A Total System Approach to Valuing the Firm" and "Maximizing Shareholder Wealth and the Greater Good."

"...a breakthrough study that will change the way business will be done..."

“DRIVEN summarizes a breakthrough study that will change the way business will be done. It offers a simple and comprehensive framework for taking on today’s complex business world. Notably, it shows how innovation beyond R&D is a key lever for generating business value, along with the important links to operations and marketing.”

—Hitendra Patel, Ph.D.
Senior Leader of the Innovation Practice of the Monitor Group
Professor of Innovation and Growth, Hult International Business School

"...should be added in the arsenal of analysts in evaluating stocks..."

"The Return Driven Strategy framework should be added in the arsenal of analysts in evaluating stocks, since it is very useful in identifying stocks that are truly cheap – both in relative terms and absolute terms. There is no doubt that traditional valuation methods such as P/E multiples are subject to manipulation due to the varying accounting definitions of earnings." As such, there is a need for an alternative means to measure value.

These methodologies provide a good way to measure value as it is based on cash earnings, adjusted for inflation. It also makes stocks comparable across different markets. By implementing these strategies, we are more confident that the stocks we recommend are truly the best and can generate alpha for our clients.

—April Lynn Lee-Tan
VP, Head of Research at Citisec Online Inc
President of the CFA Society of the Philippines

"...an invaluable compass..."

“For years I have used this framework for evaluating critical business decisions. It has been an invaluable compass when allocating resources in human capital, intellectual capital, and investment capital, particularly when those resources can be so scarce.”

—Michael Gremley
President & CEO, Voiceprism

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"...the right initiatives and objectives for the right reasons to best serve the organization..."

"I would reference the question, 'Are we doing the right things for the right reasons?' The value of Mission Driven Strategy has consistently rung true for me as it has helped us do exactly that; focus on the right initiatives and objectives for the right reasons to best serve the organization."

—Kathy Apple, RN, MS, CAE
Chief Executive Officer and 2006 RWJ Executive Nurse Fellow, National Council of State Boards of Nursing (Referring to Mission Driven Strategy, the application of the Return Driven Strategy model in not-for-profit organizations.)

"...The result: sales: UP; profits: UP; and we are a better company in just about every area of our business..."

"Return Driven Strategy helped us to create a REAL Strategic Plan and gave us the tools to examine every facet of our business. The result: sales: UP; profits: UP; and we are a better company in just about every area of our business. I just can’t say enough about the positive effect RDS has had with us. It’s provided everyone with an understandable framework to comprehend our business."

—E. Terry Groff
President, READING BAKERY SYSTEMS

"...Driven is an essential read for CEOs and senior managers..."

"Driven is an essential read for CEOs and senior managers. In a clear and readable style it successfully sets forth a road map for the creation of long term wealth. The book will also provide a valuable tool for investment managers and individual investors to identify companies whose shares have a high probability of producing long run returns. Once read, Driven will be kept in the top drawer and referred to often."

—Al Heron
Former CEO of International Carriers, Inc., Treasurer of Esso Standard Eastern Philippines,
Projects Manager of Infrastructure at Asian Development

"...what works in the real world of business..."

"Imbedded in Return Driven Strategy are the undeniable truths of what works in the real world of business."

—Edward J. Sierawski
Founder and CEO of Sequoia System International, Inc 500 High-Growth Private Business

"...resulted in dramatic improvements in our business..."

“Return Driven Strategy provides an elegant framework for business strategy considerations. By that, I mean it is marked by ingenuity, simplicity and completeness. It was an effective tool for our firm as we embarked on our strategic assessment of our core business which resulted in dramatic improvements in our business. I strongly endorse it for others following a similar path.”

—Jim Folkes
Former Vice President, Strategy and Business Development, Laidlaw Education Services

"...a great job of incorporating the role of human capital in the growth of financial capital..."

"DRIVEN provides a comprehensive and practical guide to students and management in the essential elements of how an organization can create Shareholder Value. I highly commend the authors' incorporation of the important people related considerations. Typically, most books only provide lip service in this area. Appropriate management of human capital is core to every great business strategy. The Return Driven Strategy framework does a great job of incorporating the role of human capital in the growth of financial capital."

—Mark C. Ubelhart
Principal and Practice Leader of Value Based Management at Hewitt Associates,
Architect of Hewitt’s Human Capital Foresight (HCF™) methodology

"...should be embraced by all CEOs wanting to drive the value of their companies..."

"Finally, a growth strategy framework grounded in empirical data with real world application! Driven provides a straightforward approach to profitable growth that should be embraced by all CEOs wanting to drive the value of their companies."

—Gary A. Plaster
Author of the books "Beyond Six Sigma: Profitable Growth Through Customer Value Creation" and "The Road to Success: How to Manage Growth."

"...a fundamental cornerstone to any strategic plan..."

"Return Driven Strategy should be considered as a fundamental cornerstone to any strategic plan. It covers the critical points and facets for promoting an effective level of structured thinking that is necessary when launching a new product or service. It also allows a company to understand when an essential element of a strategic plan is missing."

—Darren Guccione
President & CEO, Callpod, Inc.

"...should be part of any investor's stock selection process..."

"Frigo and Litman's framework allows the investor to judge the ability of companies to create lasting value and should be part of any investor's stock selection process."

—Alfred Jackson
Former Head of Global Equity Research at Credit Suisse First Boston
Top-Ranked Stock Analyst

"...beneficial to both investors and corporate managers in understanding the activities that truly drive company value..."

“Frigo and Litman's book, DRIVEN, includes many valuable case studies of the fundamentals behind firm's cash flow track records. I believe these discussions can be beneficial to both investors and corporate managers in understanding the activities that truly drive company value.”

—Tim Bixler
Managing Director at Credit Suisse and Head of Credit Suisse HOLT

"...the art of strategic fit..."

"DRIVEN explains a common-sense approach to strategy development. Linking strategy, execution, and valuation is tough to do. By tying together the process to ethical value creation - and a passionate desire to deliver unique offerings to fulfill unmet needs - the authors lead us in the art of strategic fit."

—Steven Kraus
Managing Director, Client Innovation, Credit Suisse

"...makes the connection between strategy and shareholder value..."

"The Return Driven Strategy framework can be a useful approach for strategic risk management and ERM. This framework fully describes the business strategy and activities that drive great financial performance and makes the connection between strategy and shareholder value. It can provide a way for directors and management to evaluate strategic plans and strategic initiatives and identify key risks that could destroy shareholder value while considering the upside of risk in terms of the opportunities."

—Mark Beasley, Ph.D. CPA
COSO Board Member
Director of the Enterprise Risk Management Initiative at North Carolina State University

"...importance of a true commitment to ethically maximize wealth..."

"Return Driven Strategy provides a framework for educating tomorrow's leaders and reminding today's leaders of the importance of a true commitment to ethically maximize wealth in corporate governance and performance measurement."

—Angelo Riccaboni, Ph.D.
Dean of the School of Economics, University of Siena (Italy)

"...the right path for educating future business leaders and guiding today's leaders..."

"Return Driven Strategy and the book Driven will be invaluable in business and academia. Frigo and Litman's framework provides the right path for educating future business leaders and guiding today's leaders in navigating an ever-changing and complex business environment."

—Dr. Ray Whittington
Dean, College of Commerce, DePaul University and Kellstadt Graduate School of Business

"...instrumental in identifying and bringing together the fundamental strategies that enhance shareholder value..."

"Over the last decade, Frigo and Litman have been instrumental in identifying and bringing together the fundamental strategies that enhance shareholder value. In Driven, they have managed to neatly organize these strategies into a coherent whole, making them both intelligible and relevant to a wide audience."

—Keith M. Howe, Ph.D.
Editor of Journal of Applied Finance, Former Associate Editor of Financial Management, William M. Scholl Professor Finance, Kellstadt Graduate School of Business, DePaul University

"...a framework for placing any business discipline in the perspective of overall business strategy..."

"Frigo and Litman's Return Driven Strategy is valuable in the boardroom and the classroom. For professors and students in business schools it provides a framework for placing any business discipline in the perspective of overall business strategy. As a board member of a corporation in the investment services industry, I have seen how Frigo and Litman's framework provides a means for the board the focus on the right issues in corporate governance, especially as they relate to communicating strategic performance goals and empowering management to achieve them while ethically increasing shareholder value."

—Belverd E. Needles, Jr., PhD. CPA
Ernst & Young Distinguished Professor of Accountancy, DePaul University, Past President of the International Association for Accounting Education and Research

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About the Authors

Mark L. Frigo, Ph.D., is Director of the Center for Strategy, Execution and Valuation and the Strategic Risk Management Lab in the Kellstadt Graduate School of Business at DePaul University in Chicago. He is Ledger & Quill Alumni Foundation Distinguished Professor of Strategy and Leadership at DePaul University. Author of six books and over 100 articles, his work is published in leading business journals including Harvard Business Review. Dr. Frigo is a Certified Public Accountant (CPA), a Certified Management Accountant (CMA) and holds a Ph.D. in Econometrics. His professional career has included corporate strategic planning, corporate mergers and acquisitions and management consulting at KPMG. In the area of strategic valuation, Dr. Frigo has served as a valuation expert for organizations ranging from privately-held companies to larger organizations such as the Chicago Board of Trade (CBOT), and as an advisor for executives teams in merger and acquisition strategy.

Dr. Frigo helps CEOs, CFOs and management teams to drive superior performance through focused strategy and strategy execution. He has successfully worked with management teams to develop the strategic leadership skills necessary in today's business environment. Dr. Frigo works with management teams as an embedded advisor to help lead successful initiatives in the following areas:

Focused Growth Strategies: Developing focused growth and innovation strategies that achieve profitable growth with less resources.
Strategic Risk Management: Leveraging risk assessments, focusing risk management on the most important risks in the business strategy and integrating risk management in strategic planning and strategy execution.
Strategy Execution: Taking strategic analysis, market research and strategic initiatives to focused strategy execution.

Dr. Frigo is a recognized thought leader and advisor in strategy execution and strategic risk management. He has presented keynote presentations and executive workshops to Fortune 100 companies, trade associations and professional organizations throughout Europe, Asia-Pacific, South America and North America.

Professor Joel Litman is a Managing Director at Equity Analysis & Strategy where his team is focused on uncovering significant stock market mispricings. Litman’s clients are some of the largest and most influential investors and investment firms in the world. In the past, Litman has also worked at American Express, Deloitte Consulting, and Credit Suisse First Boston.

When the underlying value of the business greatly differs from the embedded expectations in the stock price, the probability for positioning for out-sized returns is highest. Litman’s work and research focuses on uncovering informational and analytical advantages that can help determine where such securities mis-pricings may exist.

Litman has spoken in venues including:

Harvard Business School
London Business School
The Wharton School of the University of Pennsylvania
SAIF in Shanghai, China
The Center for Strategy, Execution, and Valuation at the Kellstadt MBA Program in Chicago
Investment firms and corporate executive retreats around the world

Litman teaches regularly at top universities and conducts presentations with the CFA Institute’s Retained Speakers Bureau in cities around the world including New York, Chicago, Hong Kong, Tokyo, London, Dubai and elsewhere. He is a member of the Global CFA Institute for Chartered Financial Analysts, a CPA in the United States, holds a B.S. in Accountancy from DePaul University in Chicago, and an MBA/MM from the Kellogg Graduate School of Management at Northwestern University.