Organizational structure analysis Vs Financial analysis; Which is a better investment decision tool?
It's common for an investor to do the financial analysis of the company they want to invest in. It's uncommon for an investor to do the organizational structure analysis. The latter is usually done by management for the purpose of internal decisions. The organizational structure of a company defines its business approach. The way a company approaches its business operations has a significant impact on its performance. Its performance is the primary determinant of either profitability or non-profitability. The profitability of a company is known by carrying out the financial analysis of its performance within its industry over a range of financial years. Profitability and its consistency form the primary concern of an investor. It is the consistency in profitability that guarantees regular payment of dividends, interest on debt and return of principal. The foregoing indicates that both organizational structure and financial analyses of investment options could improve invest...