non-financial performance

Question 1

what do non-financial methods include :

Answer 1

1. employee attitude surveys
2. customer attitude/satisfaction surveys
3. productivity (and other labour performance statistics)
4. market share
5. environmental performance
6. quality

Question 2

what are employee satisfaction surveys used for ?

Answer 2

to find out about the views of workers in regard to their roles in the business and overall business performance

Question 3

what is the overall objective of employee attitude surveys ?

Answer 3

to discover the needs of the business from the point of view of employees

Question 4

what will employee attitude surveys allow a business to ?

Answer 4

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 HR policies

Question 5

benefit of productivity in assessing performance :

Answer 5

high productivity can lead to lower unit costs

Question 6

negative of productivity in assessing performance :

Answer 6

speed of working may reduce quality

Question 7

benefit of market share in assessing performance :

Answer 7

an increase can indicate the success of the business

Question 8

negative of market share in assessing performance :

Answer 8

it does not show if the market is growing or shrinking

Question 9

benefit of sales targets in assessing performance :

Answer 9

indicates whether objectives have been met

Question 10

negative of sales targets in assessing performance :

Answer 10

factors outside the business’ control might have caused sales targets to be missed, or their overachievement

Question 11

benefit of environmental impact in assessing performance :

Answer 11

this is a ‘hot topic’ amongst consumers at present; anything that can be done to make a firm appear to be more environmentally friendly is likely to impress current and potential customers

Question 12

negative of environmental impact in assessing performance :

Answer 12

it can take quite a long time for environmental policies to take effect, as it may require new suppliers to be sought or there may be a very gradual reduction in pollution, for example

Question 13

benefit of quality in assessing performance :

Answer 13

consumers wish to purchase good quality products; a rise in quality is likely to lead to an increase in demand and, consequently, an increase in profit

Question 14

negative of quality in assessing performance :

Answer 14

some measures used to increase quality may not be cost-effective as the cost of them outweighs the potential gain

Question 15

benefit of customer satisfaction in assessing performance :

Answer 15

contented customers are vital to a firm’s success, particularly if they remain loyal to the firm

Question 16

negative of customer satisfaction in assessing performance :

Answer 16

it can be difficult to measure customer satisfaction, particularly when using questionnaires as only those not happy with a firm’s products may respond