Performance measurement and evaluation is crucial for the success of any business. Performance of the employee as well as business performance has to be measured and evaluated. This chapter concentrates on the performance measurement and evaluation of the business. A standard process is being developed for measuring the performance of the global business. The process is depicted below -
Performance standards are applicable to some of the elements such as customer service, cost, and quality. The manufacturing performance of different units determines the performance standards. The performance of the manufacturing units includes aspects such as quality of the product, process yields, the spending levels of the business etc.
The actual performance is measured by collecting the information. In order to facilitate with accurate data collection, some of the automated data collection systems are provided. The performance can be measured in terms of working hours which includes man-hours, machine-hours and material usage.
Once the data and information is collected, the actual performance is compared with the standard performance levels and is analyzed for the deviations. The standard set for comparison should be achievable and realistic. The performance is analyzed such that the rules can be modified further.
Once the performance is analyzed, in accordance with deviations further course of action is constructed and implemented. The problem areas can be identified by using variance analysis. This analysis enables to identify the root cause and the source of the problem and accordingly determine the ways in which the situation can be useful. Again the effectiveness of the variance analysis depends on the correctness of the information.
Finally the standards are being reviewed and revised. The standards are adjusted according if the variances are significant an in accordance with the overall strategy the performance measurement is effectively integrated.
Effective performance measurement system can be obtained by -
In order to achieve the objectives of the business organization, the operations of the business has to be reviewed periodically, which is known as performance evaluation system. The costs and profitability of the domestic and foreign operations have to be evaluated by accurate accounting information.
Evaluating the performance of an individual, a subsidiary or a company as a whole is not an easy task. Some of the main objectives behind performance evaluation are as follows -
Some of the financial and Non-financial measures that are being used for evaluation are as follows -
The performance of the international firm can be evaluated by this Return on Investment method. The relationship between the capital invested and profit is estimated by this method. The good sign for the business is that the ROI should be improving.
The operations of the business are measured and controlled by budget. Added to this, in order to forecast the future operations, budget can be used. The performance standards of the individuals are set by the managers by using the set of objectives defined in the budget. Budget also enables to facilitate smooth functioning of the strategic planning process.
Market Share, Exchange Variations, Quality Control, Productivity Improvement, and Percentage of Sales are some of the non-financial measures that are being used for performance evaluation.
The performance can be evaluated in different ways. The following are some of the types for evaluating the performance. They are as follows -
International Business Management Related Interview Questions
|Business Environment Interview Questions||Strategic Management Interview Questions|
|Business Ethics Interview Questions||Business Law Interview Questions|
|Business Management Interview Questions||International Trade Interview Questions|
|International Relations(IR) Interview Questions||Small Business Interview Questions|
|Business Development Manager Interview Questions|
International Business Management Related Practice Tests
|Business Environment Practice Tests||Strategic Management Practice Tests|
|Business Ethics Practice Tests||Business Law Practice Tests|
|Business Management Practice Tests||International Trade Practice Tests|
|International Relations(IR) Practice Tests|
International Business Management Tutorial
All rights reserved © 2020 Wisdom IT Services India Pvt. Ltd
Wisdomjobs.com is one of the best job search sites in India.