Measuring the Company’s Performance
July 26, 2010
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Posted by admin
There are lots of factors that affect on the company’s performance, among them are like external business environmental factors such as government policy, legal and political power, technology, resources, competitors, customers taste and management. In the perspective of strategic management, the environment is an important contextual factor that has impact on the company’s performance.
The external business environment is an environment outside the organization, but consider in making business decisions. Finding other contextual factors that affect the performance such as technology, uncertainty, strategies and competencies. Globalization, economic conditions, technological change can also affect on the company’s performance.
In addition, the industrial environment also plays a role for accelerating the environmental changes that finally affect on the company’s performance. Industrial environment is the bargaining power that is held by the buyers and the suppliers, the introduction of the new entrants that are potential, the existence of substitute goods, and the intensity of competition. Measurement of the company’s performance can be divided into two groups, namely the measurement of financial performance (financial performance measurement) and non financial (non-financial performance measurement).
Basically, the financial aspect is the source of all decisions, actions and management activities. But the measure that is based only on financial performance can not disclose the ability of the organization (company) to create an economic value for the future comes. Although some researchers showed concern on the use of accounting returns, most research considers that accounting measures are acceptable.
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Categories: Financial Information
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Tags: companys performance, financial data, financial performance, Financial report
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