14.5: Why It Matters- Performance Evaluation in Organizations
Financial data such as sales and expenditures are crucial to managing and improving business operations. Comparing sales from year to year, or expenditures as a percentage of sales can give you excellent information about operations. Budgetary analysis will help managers see if they are on track with projections, or if they need to improve.
Just as important are non-financial markers such as number of customer complaints or machinery downtime. These markers can be use to help improve operations as well.
Understanding the myriad of financial and non-financial pieces of information that go into analysis of business operations will bake work as a manager easier. Knowing what benchmarks you have in place, and where you are on a weekly, monthly, quarterly or yearly basis can make for higher profitability, happier employees and satisfied customers!