205-Analsing non-financial performance

Question 1

Non-financial methods of analysing performance

Answer 1

1)Market share
2)Customer attitude survey
3)Environmental record
4)Employee attitude surveys
5)Productivity
6)Sales targets

Question 2

How does Market share show non-financial performance ?

Answer 2

Indicates brand loyalty, competitive advantage and profitability (due to economies of scale)

Question 3

How does customer attitude surveys show non-financial performance?

Answer 3

It measures the degree to which customer expectations are met or exceeded. Methods include level of repeat purchases, amount of customer complaints, percentage of products returned and by gathering feedback by questionnaires and focus groups. Improving customer satisfaction and loyalty then in the long-term this will result in increased sales and profit

Question 4

How does environmental records show non-financial performance?

Answer 4

Can assist businesses with assessing their impact on their external environment to highlight where improvement can be made

Question 5

How does Employee attitude surveys show non-financial performance?

Answer 5

Discover the needs of the business from the point of view of employees. It will allow them to:
-identify issues and problems that exist e.g. low employee satisfaction
-indicate how motivation can be improved
-judge reaction to proposed change
-assess effectiveness of policies

-Improve employee satisfaction and retention as labour problems can cause loss of sales and increased costs

Question 6

How does productivity show non-financial performance?

Answer 6

employees with higher productivity suggests efficiency. High productivity can reduce average unit costs and make a business more competitive (economies of scale?)