HBR Guide to Finance Basics for Managers

by Harvard Business Publishing

DON’T LET YOUR FEAR OF FINANCE GET IN THE WAY OF YOUR SUCCESS Can you prepare a breakeven analysis? Do you know the difference between an income statement and a balance sheet? Or understand why a business that’s profitable can still go belly-up? Has your grasp of your company’s numbers helped—or hurt—your career? Whether you’re new to finance or you just need a refresher, this go-to guide will give you the tools and confidence you need to master the fundamentals, as all good managers must. The HBR Guide to Finance Basics for Managers will help

Genres: Business, Finance, Management, Buisness, Leadership, Reference, Money

ebook

First published April 14, 2011

About the author

Harvard Business Publishing (HBP) is a publisher founded in 1994 as a not-for-profit, independent corporation and an affiliate of Harvard Business School (distinct from Harvard University Press), with a focus on improving business management practices. The company offers articles, books, case studies, simulations, videos, learning programs, and digital tools to organizations and subscribers.
HBP consists of three market units: Education, Corporate Learning, and Harvard Business Review Group. Their offering consists of print and digital media (Harvard Business Review, Harvard Business Review Press books, Harvard Business School cases), events, digital learning (Harvard ManageMentor, HMM Spark), blended learning, and campus experiences.

Reviews

[Derek Emerson · Rating 2 out of 5]

While providing some good basics, the reading is jumpy and repetitive as it is simply a compilation of different HBR publications. In fact, two chapters (one right after the other) give contradictory reads on ROI thinking, which is hardly helpful for someone trying to learn the basics. Good to keep as a basic resource.

[Colin H · Rating 3 out of 5]

Helpful orientation for financial accounting in the first section. The rest was interesting business cases that helped to reinforce concepts, but a lot of the learning just needs to be hammered in. Improved from a 20% to a 60% on the quiz, but obviously still bad. Will supplement with youtube videos.

[Amelia · Rating 5 out of 5]

Great intro for anyone in business who doesn't have a finance background. And if you do, there are still many gems here.

[Giancarlo · Rating 5 out of 5]

Finance is pretty simple! This book is the bible to use it in order to manage your business. Great book.

[Farida Badry · Rating 2 out of 5]

After reading Ram Charans “what a CEO wants you to know” this one was kind of anti climactic. My issue maybe was I assumed this would be more complex, yet it was nearly the same level of detail and maybe even too similar in the context even though it was supposed to be less story telling and more “technical”. I would recommend anyone jumping into finances of a company or wanting a refresher before taking the next step in their career to definitely read one of the two books, but not both id say.

[Mark Muckerman · Rating 3 out of 5]

The "HBR Guide to" series is always reliable in content, applicability and (usually) ease of understanding for the non-expert. Finance Basics is also in that vein: Content is good; basic; clear, etc. However I'm going with 3 stars vs. 4 because as a non-finance guy (I get the numbers, I get the need, I get the value) the overall concepts and use-case applications could have been presented a little more explicitly to account for a more diversified learning-style reader audience.

I see this one as a book I'll need to read about every 6 months to constantly ingest and digest more through repetition.

[Noah Skocilich · Rating 4 out of 5]

Good for what it was - a quick ‘for dummies’ primer on the basics of business finance.

I feel empowered and enriched by having spent the hour or so it took to read it. I feel like I understand much better how my managers are seeing the company I work for and how their goals and objectives are framed.

[Cydney Reads · Rating 5 out of 5]

Required Reading

Although this book was required reading I really enjoyed it. The book not only explained the basic terms and tools of business, but as the reader I was able to read it and not get the textbook type of voice, but something that told more of a story interwoven with real life cases.

[Joe Murphy · Rating 4 out of 5]

To supplement Corporate Financial Mgmt reading

[Azael Capetillo · Rating 4 out of 5]

Good basic book on finance, will help you understand basic, and important, principles of financial management.

[mukda teeralertpanich · Rating 3 out of 5]

This book covers all financial basics and not too hard for the starters.
Some parts are boring and full of specific financial words.

[Nabeel Mk · Rating 3 out of 5]

Somewhat does what it says: Decoding the jargons. Till preparing budgets it was crisp. After that, it is just a quick read with not much to learn.

[Faye · Rating 4 out of 5]

Very good review of foundational business finance. I especially enjoyed some of the examples cited along the way to illustrate key concepts.

[Rafael Silva Manojlovic · Rating 5 out of 5]

This book is pretty good if you are getting in touch with financial terms and business analysis for the first time.

It is not a book by a single author, it is a compendium of analyzes by different experts and is very well sequenced, which makes it less burdensome to read.

I like that at the beginning you have a test of 10 questions and it gives you an idea of ​​how much you know about the subject, and then at the end you apply it again. In my case, for being the first time that I got into these concepts seriously, I got from a 1/10 to a 6/10 at the end of the book.

The main focus is to explain what they are, how they should be read and what kind of decisions you can make from the readings of the financial statements: Balance Sheet, Income Statement and the Cash Flow Statement. For example, the main financial ratios that you should take into account when making decisions are analyzed: EBIT, ROA, Gross Profit Margin, etc.

There are some chapters focused on the importance of analyzing the Income Statement, as the most important report for a manager to make operational decisions, since it contains direct information for the generation of income and budget control.

On the other hand, analyzes are made to know how we know if a company is making money or not, through growth indicators, cash generation and return on assets.

For companies that handle subscription models there is an excellent review of how Down Jones went from the traditional scheme to the digital one, maintaining the same working capital that allowed it to remain the same or even more profitable than similar print media that also switched to digital models.

It contains chapters dedicated to the economic analysis of projects taking into account the internal rate of return, net present value, rate of return, etc.

Finally, just as it indicates what the financial statements tell you and how reliable they are, they also dedicate several sections to explain what those statements DO NOT say and the five traps that financiers fall into to manipulate these reports and make see a different reality of the company .

[Mr. Reader Eric Mesa · Rating 5 out of 5]

This is absolutely a book that I would recommend for anyone at all. If you work in any business at all, you can profit from it. But even if you don't, it's still an interesting book for understanding how firms account for their businesses. HBR presents a simple, concise, and fun layout of finance that encourages practical aspects of finance and accounting. If you are concerned that finance is too abstract or complicated for you, then you would profit from this book. The author was even kind enough to provide pre- and post- read tests that allow the reader to assess their understanding of the subject matter. I for one intend to read this book until I score a hundred percent, and I doubt that re-reads will be tedious in the least.

[Luis Ferrao · Rating 4 out of 5]

4.0 estrelas (e-book)

Livro dividido em três seções.

Na primeira fala dos três estados (balanço conta de resultados e fluxos de caixa).

Na segunda alguns rácios (ROA, ROE, ROS, rotação de activos, prazos médios de pagamentos e recebimentos, liquidez, tesouraria, de alavancagem)

Na terceira parte um alerta sobre os limites da gestão baseada apenas em racios, nomeadamente o facto de não compararem com pares, comportamentos desviantes para os atingir, olharem para o passado e tendência de usar sempre os mesmos racios para medição de performance.

Bom livro para conceitos básicos de gestão financeira

[Jack Trump · Rating 3 out of 5]

Definitely some useful insights/perspectives, but past the introduction that was written for this collection of articles, I found the value diminishing. It's essentially a collection of HBR's greatest-hits about financial analysis that are geared toward non-financial people, and based on the title I was hoping for something a little more comprehensive.

[James · Rating 4 out of 5]

Good but I hate finance. Basics covered so I now know what my bosses are talking about without looking like an idiot most of the time. Took me a bloody long time to finish such a small book.

Don't recommend reading in bed.

[Anwar · Rating 5 out of 5]

Comprehensive Pocket Guide for Managers

If you’re inexperienced in finance, this is a great crash course and reference guide, especially the glossary. It is best to refer to and retake the quizzes, as well.

[Andrew Sitter · Rating 3 out of 5]

Good high level overview of corporate finance. If you're not looking to go deep on the subject this would be a good resource, but there are other books out there that contain much more information without taking too much more of your time.

[Itzel Diaz · Rating 4 out of 5]

Un libro que te permite volver a empezar en las finanzas. Recordar lo que la experiencia y los libros nos han enseñado. Lo recomiendo para el que quiera refrescar los conocimientos y todo el que no tenga experiencia en el área, para iniciar a involucrarse en el interesante mundo financiero.

[Amber · Rating 3 out of 5]

Originally purchased this book because it’s suggested reading for a certificate I’m not longer interested in pursuing. Then decided to read it in preparation for a finance class I’m taking. All I feel like I got out of it though was a review of basic accounting.

[Hassan Alamri · Rating 4 out of 5]

Good book for providing the basics for non- financials. It focuses on understanding the 3-financial statements in addition to the profitability ratios. Highly recommend for understanding the basics.

[Jay · Rating 2 out of 5]

Not that useful of a read. It cautions on assumptions with different cash flow/profit scenarios that appear positive/negative but are really the opposite.

[Ryan Reslan · Rating 5 out of 5]

A great intro into finance for new managers!

[Isabela Perez · Rating 4 out of 5]

Muy útil

[Suresh S · Rating 5 out of 5]

Excellent read for engineers on finance concepts..

[Saurabh · Rating 5 out of 5]

Highly recommended for managers who do not have a formal background in Finance.

[Diego Romero · Rating 5 out of 5]

Very objective and succinct when approaching various themes inside finance. It finishes with a great statement about how all departments should engage.

[Jeevan · Rating 4 out of 5]

Quick read on basics of finance. It's basically a collection of HBR articles organized by three themes of: basics, making decisions and limits of financial data.