Executive summary

Capital allocation is the disciplined deployment of a firm's cash across reinvestment, M and A, debt paydown, dividends, and buybacks to maximise long-run value per share. This is the Capital Allocation Framework from the Stratenity Library, a governed consulting deliverable that is already built for you. It gives your team the full working method for capital allocation, and it walks through everything from sizing the capital pool: operating cash, balance-sheet capacity, and constraints to m and a discipline: when an acquisition beats a buyback. Every asset ships with a worked client example, a clear RACI, defined KPIs, and governance you can defend, so your team adapts it to a live client engagement instead of starting from a blank page.

What is inside

What this framework covers

This is a preview of the full deliverable. Inside the Stratenity Library, this framework walks a consultant through the complete method, section by section, with a worked client example threaded throughout.

  • Why Capital Allocation Is the CEO's Highest-Leverage Decision
  • The Full Menu of Uses: Reinvestment, M and A, Debt, Dividends, Buybacks
  • Sizing the Capital Pool: Operating Cash, Balance-Sheet Capacity, and Constraints
  • Setting a Defensible Hurdle Rate: Cost of Capital and Unit Risk Premia
  • Ranking Uses by Risk-Adjusted Return
  • Organic Reinvestment: Maintenance Capex, Growth Capex, and the Returns Test
  • M and A Discipline: When an Acquisition Beats a Buyback
  • Returning Cash: Dividends versus Buybacks and the Value-Per-Share Math
  • Debt Paydown and the Optimal Capital Structure
  • The Portfolio View: Allocating Capital Across Business Units
  • Governance: The Allocation Cadence, the Board's Role, and Guardrails
  • Value-Destroying Patterns: Empire-Building, ROIC-Dilutive Growth, Buybacks at the Peak
  • Common Pitfalls and the Deliverable Pack
How to use it

Review, download, and activate in 48 hours

Stratenity Library subscribers can review this framework in full, download it, and activate it into a governed, client-ready deliverable in 48 hours rather than weeks. Each asset ships with a worked client example, a clear RACI, defined KPIs, and governance you can defend.

Read the full asset on the Stratenity Library › Not a member yet? Start a free trial to unlock and activate it, or sign in if you already have an account.