Course Outline
Introduction to CAPEX and the Investment Mindset
- Defining capital expenditure within a manufacturing context.
- The role of financial evaluation in operational decision-making.
- Common pitfalls faced by non-finance managers.
- Linking CAPEX to strategic business objectives.
Time Value of Money, Discount Rates, and WACC
- Understanding present value and future value concepts.
- Calculating and selecting appropriate discount rates.
- Weighted Average Cost of Capital (WACC) and project-specific rates.
- Practical exercises on discounting cash flows.
Net Present Value (NPV), IRR, MIRR, and Payback Period
- Calculating NPV as the primary investment criterion.
- Using IRR as a secondary screening tool.
- Avoiding reinvestment assumption issues with Modified IRR (MIRR).
- Applying the Discounted Payback Period as a liquidity gate.
Economic Value Added (EVA) and Shareholder Value
- Calculating EVA: NOPAT minus (Capital Invested x WACC).
- Aligning CAPEX budgeting with shareholder value creation.
- Comparing EVA with traditional accounting metrics.
- Case study on value-based management in manufacturing.
Building the CAPEX Business Case
- Structuring cash flow projections for capital projects.
- Separating operating and capital cash flows.
- Considering working capital and terminal value.
- Constructing a complete investment case from operational data.
Scenario and Sensitivity Analysis
- Developing three scenarios: Base, Optimistic, and Pessimistic.
- Creating tornado diagrams for sensitivity ranking.
- Identifying value drivers and critical assumptions.
- Practical exercises in Excel.
CAPEX Processes, Templates, and Capex Cards
- Stage-gate approval processes for capital projects.
- Designing one-page Capex Cards with strategic alignment.
- Including financial metrics, risk ratings, and timelines.
- Standardizing Requests for Funding documentation.
Risk Analysis, Monte Carlo Simulation, and Real Options
- Applying Monte Carlo simulation with spreadsheet add-ins and Python.
- Managing uncertainty in manufacturing investment decisions.
- Real options analysis for production flexibility and expansion.
- When to use probabilistic versus deterministic models.
ESG, Sustainability, and Regulatory Considerations
- Integrating ESG and sustainability metrics into cash flows.
- Carbon costs, energy efficiency, and green capex incentives.
- Adjusting risk premiums for environmental compliance.
- Communicating sustainability benefits to financial stakeholders.
Executive Narrative, Storytelling, and Requests for Funding
- Crafting a clear executive summary for CAPEX proposals.
- Structuring the ask and linking it to strategic value.
- Storytelling techniques for non-finance audiences.
- Reviewing and critiquing sample funding requests.
Post-Investment Review and Benefit Realization
- Establishing post-investment review (PIR) frameworks.
- Tracking actual versus projected benefits.
- Feedback loops to improve future CAPEX proposals.
- Creating a culture of accountability in capital spending.
Requirements
- A working knowledge of manufacturing operations and plant management.
- Experience using spreadsheet software such as Microsoft Excel.
Audience
- Manufacturing managers and plant supervisors lacking a financial background.
- Engineering managers preparing capital expenditure proposals.
Custom Corporate Training
Training solutions designed exclusively for businesses.
- Customized Content: We adapt the syllabus and practical exercises to the real goals and needs of your project.
- Flexible Schedule: Dates and times adapted to your team's agenda.
- Format: Online (live), In-company (at your offices), or Hybrid.
Price per private group, online live training, starting from 3200 € + VAT*
Contact us for an exact quote and to hear our latest promotions
Testimonials (3)
How to manage business financials
surprise mtileni - Hatima Holdings (Pty) ltd
Course - Learning Xero
Flexibility in the course delivery and the interactive approach. The trainer was open to questions, clarified doubts clearly and also considered participants suggestions during the sessions. The training was well structured and informative.
Soundarya Mohan - Mizuho Bank Europe N.V.
Course - Financial Analysis in Excel
Good communication, open for discussion, kept it interesting and engaging
