Allocating Capital for Sustainable Operations

Reviews how past capital allocation decisions created financial pressure and unsustainable outcomes.

---

Note: Data is Randomly Generated

For demonstration only, the data are randomized and all naming is fictitious.

# Get the R files containing the functions with plots
purrr::walk(list.files(
  'docs//01-Visual-Storytelling//01-Capital-Allocation//functions//', 
  pattern = "\\.R$", full.names = TRUE), 
  source
)

1 Nearly All Sources of Cash used by Operations

Cash from multiple sources was consumed by day-to-day operations, leaving little for investment or growth.

See full function here.

allocation_history()

---

2 Expected Allocations Predict Debt Financing to Support Uses of Cash

Forecasts show anticipated reliance on debt to cover operating cash needs, raising future financial risk.

See full function here.

---

3 Allocations Fall Outside the Acceptable Ranges

Actual allocations drifted outside targeted ranges, signaling opportunity for enhanced controls and capital framework implementation.

See full function here.

allocation_ranges()

---

4 High Realized Growth Relative to Expected Growth

Realized growth outpaced planned levels, but capital use did not align with a sustainable model.

See full function here.

# Call funtion
plots_anticipated_allocation <- anticipated_allocation()

plots_anticipated_allocation$index_growth # display

plots_anticipated_allocation$ranges # display

---

5 Opportunity Cost of Perpetual Investment Returns Rise

By redirecting more cash into investments, the business could have built a steady, recurring income stream.

See full function here.

investment_opportunity()