Human Resource Performance 1 Flashcards

1
Q

What are the downsides with labour productivity calculations?

A
  • Does not take into account wage rates (key factor of employees performance)
  • Does not take into account technology used in the production process
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2
Q

Unit costs have an ……………. relationship with labour productivity

A

inverse, as labour productivity rises unit costs should go down.

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3
Q

When may labour costs rise?

A

When receiving training, however this may be beneficial in the long term

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4
Q

Equation for employee cost as a percentage of revenue

A

employee cost /

sales turnover x 100

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5
Q

What does employee cost as a percentage of total revenue measure and when may it be useful?

A

it compares employee cost against the total business revenue. may be useful when label costs are high as a percentage of total costs

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6
Q

What factors can influence employee cost as a percentage of total revenue?

A
  • High labour productivity can lead to higher sales revenue therefore lowering the percentage costs compared to revenue
  • Human resource capacity must be maximised to lower the percentage costs

-Any increase in wages must have an impact
in labour productivity otherwise the labour cost would rise

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