ncial risk would cause shareholders demand for an additional risk premium. This is an increase to the cost of capital. Moreover, in Appraising projects just considering cost of capital and the usage of Net Present Value Method or Internal Rate of Return would be sufficient. Current there is a new method called the Project Wealth Creation Profile. The idea is that projects are competing for capital and projects should be awarded according to the following criteria: - (a) Financial Value (b) Cash Flow Profiles (c) Strategic Value (d) Stakeholders Value (e) Risk Profile (f) Management Motivation As capital is scarce, the company should employ careful steps in deciding how to spend its capital. As for the operation side of Kao Corporation, it has yet to implement Just in Time stocking system. A lot of Kao’s Japanese counterparts have already adopted JIT. JIT can provide Kao with stockholding cost savings. This would be inline with Kao’s ongoing operational reforms and Total Cost Reduction efforts. In the area of marketing, Kao should develop a catchy jingle to accompany a unique advertisement, which will be shown repetitively. The aim is to have high Brand Recall Rate in the minds of consumers. Then at the point of sale or high traffic outlets, supporting promotional tools such as promoters and shelf fliers should be use. By combining high recall rate and supporting promotional tools at the point of sale, Kao’s sales can be increase. This is because most of the time, the decision to buy a fast moving consumer product like shampoo is made at the point of sales. Moreover, as Islamic countries like Malaysia and Indonesia emerge as the big markets of tomorrow, there is an opportunity for Kao Corporation to use its R&D capabilities that would be specially designed for the Islamic society. Zaitun in Malaysia has proven that this strategy can be very successful. In addition to obtain further cost reduction, further product standa...
