13. Case Studies: Risk Analysis, Company Valuation, and Strategy Valuation

This chapter delves into the critical aspects of risk analysis, company valuation, and strategy valuation, with a focus on practical case studies. It explores how companies can evaluate strategies by weighing risk and return, and how traditional corporate planning can be expanded into range planning by linking it with identified and quantified risks. The case study on strategy valuation for a listed company demonstrates the use of simulation-based valuation methods to assess the impact of an outsourcing strategy on shareholder value. The chapter also covers company valuation using the Capital Asset Pricing Model (CAPM) and risk-adequate valuation methods, highlighting the importance of considering the probability of insolvency and the risk-return profile. Additionally, it provides insights into budget planning and risk aggregation using Monte Carlo simulation, offering a comprehensive approach to corporate planning and risk management. The conclusion emphasizes the significance of simulation-based bandwidth planning in supporting corporate management decisions and enhancing the success of companies.