Creating a comprehensive system to measure performance
Article Abstract:
Comprehensive performance measurement systems that incorporate both financial and nonfinancial variables are gaining widespread acceptance. Research has shown that conventional systems, which consider financial conditions only, are actually poor indicators of corporate performance and are oriented solely on internal factors, hence, excluding significant forces in the environment of the company. Thus, quality, customer satisfaction, innovation, personnel development and market share are increasingly being used as measures of corporate standing. Before such systems can be developed, a business performance model that will be the basis of measurement should first be created. Only then can the appropriate methodologies and test frequency be devised. The finished measurement performance systems, however, should be changed as conditions in the environment also change.
Publication Name: Management Accounting (USA)
Subject: Business, general
ISSN: 0025-1690
Year: 1992
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Does ROI apply to robotic factories?
Article Abstract:
The validity of the return on investment (ROI) model as a method of performance evaluation is being questioned. The Du Pont formula of the ROI model has come under scrutiny because of its questionable applicability in an automated manufacturing environment. The application of robotics to the manufacturing process will result in the transition from variable to fixed costs thus making the ROI method increasingly difficult to apply. Criticism for the ROI method is compounded by the tendency of the ROI method to foster interorganizational objectives that are dysfunctional. Enhancing the acceptability of the ROI method of performance evaluation will require the consideration of several factors, that include long-range performance, cash flows, and the time-value of money.
Publication Name: Management Accounting (USA)
Subject: Business, general
ISSN: 0025-1690
Year: 1992
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Productivity measures aids in profit analysis
Article Abstract:
Using a system devised by the American Productivity Center, Touche Ross and Co. has developed a productivity measurement aid called Total Productivity Measurement. The formula requires dividing the total production units by the total resource units required which shows the company's total productivity. This is used to analyze the company's profits which are dependent on changes in the unit cost of resources, the unit selling price, or a change in the quantity of resources used per unit of output.
Publication Name: Management Accounting (USA)
Subject: Business, general
ISSN: 0025-1690
Year: 1985
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