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•Six Greatest Financial Necessities of Business Life 73

would sell more tyres and exhausts. After some bargaining the sales director agreed
that he would stand by a claim of 5% more sales. And so on. He built a case for the
benefits.

With the IT manager, George built a picture of the costs over a five-year period,
found that the project was profitable, but needed help to see if this was confirmed
by the cashflow. With some trepidation George went to see the finance director,
who took him through the calculation. Using the discount factor of 21%, the com-
pany norm, the project ended up with a negative net present value. George was
devastated.

He returned to the sales director crestfallen to report that all their work had
ended up torpedoed by the finance people. The sales director looked at the cashflow
and suggested that George should see if the case worked if he, the sales director,
agreed that a 10% sales increase was a more likely outcome. It did and George got
the order and a lot wiser.