Overall Performance 3.7.3 Flashcards
Name some non financial date used to measure performance in marketing
amount of customers that come back
how loyal customers are
brand awareness
perceived quality
Also can use competitors by comparing your own business to them
Name some non financial date used to measure performance in operations
Managing quality
Managing waste
Productivity
Managing time
Name some non financial date used to measure performance in HR
labour turnover
annual ratings of job satisfaction
absentee rate
what are core competences
A unique ability that a company acquires from its founders or develops and that cannot be easily imitated. Core competencies are what give a company one or more competitive advantages, in creating and delivering value to its customers in its chosen field.
why are core competences important
They are extremely useful in the long term.
This competences differentiates you from other business and can therefor can make you more attractive
Gives it strength in the market
what is short- termism
when the decisions of a manager show an obsession with the immediate issues rather than long term ones
what are the causes of short termism
Uses of short term performance measures
the threat of takeover, by increasing their short term profits, they can make it harder for business to take over
Increasing short term profit when they float onto the stock market so that shares are higher price and more attractive to investors
pressure from shareholders and stakeholders ( for that phat bonus)
what are the effects if short termism
reluctant to pay for training and advertising
screw the business in the long term causing the business to go bankrupt
staff that focus to much on the short term gains effecting business market share
name some methods of assessing overall business performance (case study methods)
Kaplan and Norton’s Balanced Scorecard
model
Elkington’s Triple Bottom Line (Profit, People,
Planet).
What is Kaplan and Norton’s Balanced Scorecard
model
based on four perspectives
1) the financial perspective, how do we look to our shareholders
2) the customer perspective, how do we look to our customers ( customer satisfaction)
3) the business process perspective, how effective are we internally
4)the learning and growth perspective, how can we change and improve
(when implementing set it out as main factors, what to measure, how to measure)
what is Elkington’s Triple Bottom Line (Profit, People,
Planet).
a bottom line in a income statement is the profit of the year. His triple bottom line would include financial accounts, social accounts, and environmental accounts.
the financial aspect would include profit of the year
the social aspect would include how much you spent on your social accounts ( providing jobs, training)
the environmental aspect would include how the business effected the environment and money speant on it
what are the strengths of the balance scorecard
gives a more all round view of the company and its achievement and failings
encourages companies to find measures that look at
the present and the future, not the past
measuring you business improves managements
what are the strengths of the triple bottom line approach
it would encourage firms to act more environmentally
publishing these measurements would give incentive for managers to work harder
weaknesses of the balance scorecard
can cause managers to hit these targets even if it is at the expense of other parts of the business or if these are measured in the short term then can cause short termism.
can take a up a lot of time using it which can make it inflexible
can put a lot of pressure on managers to meet a certain standard
weaknesses of triple bottom line
could cause other areas of the business to be overlooked
not everything can be measured so can therefore be inaccurate
If organisations only want to appear to be monitoring the triple bottom line, rather than actually doing it, then they will be wasting resources.
