Peattie & Taylor´s Alex© comic was featured in VBM Consulting´s 2001 best-seller, Net Value: Valuing Dot-Com Companies Uncovering the Realities Behind the Hype (Clark & Neill, New York, Amacom).

In Chapter 1, we parodied the quasi-criminal practice of pretending that worthless e-businesses had any worth at all. The strip´s main character, Alex Masterly, instructs his junior lackies to access or ‘hit´ his Dot.Con client company´s website a thousand times or night or more.

With no legitimate, value-creating business model for 95-99% of these vapor businesses, investment bankers needed to create their own rules of mathematics to suspend disbelief, even temporarily. In this case, the laughable fiction was that the number of times that anyone visits that site is a basis for valuation. Such literally bankrupt logic is the equivalent of trying to value a store based on the number of cars passing by it on a highway a mile away.

But without this type of Criminal Math, the investment bank sharks would never have been able to steal their underwriting fees from taking WorthlessLoser.com public in an IPO. Alas, the anti-heroes of 1998-2001 have mostly been stripped of their stolen booty.

Most of the Alex strip´s ideas come from readers themselves, so there´s a biting truth associated with many of them. Including one of the most recent (May 4) where executives search the Internet, presumably for the best and most convenient short-haul airfares.

But these execs are not looking for the cheapest fare, or even the most convenient time of departure or arrival. These furiously-clicking executives are scrambling to find a flight in which the economy section is all filled, as they are the authorized by company rules to upgrade to a more expensive business fare, at greater cost to the company.

Spending other people´s money. That´s the same black motivation that inspires some second-tier‘value´ consultants to squander tens of millions of their clients´ funds on unnecessarily analysis of the obvious by novice MBAs. It is the dark side of top-up pensions for failed senior executives and treating value-destroying managers as royalty for their incompetence.

Managing for Maximum Value©* begins with every individual in the company thinking about whether the action being considered (or in some instances, inaction) is creating or destroying value for the corporation.

The gamesman who tries to find the loopholes in the company´s rules that permit value destruction to occur might be seen at the moment as clever by like-minded colleagues, who work to Beat the Rules rather to do the best by the owners of the business. Soon, they are all gone.

*Managing for Maximum Value is 2003-4 copyright VBMCL, all rights reserved.
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