Discuss About The Determining Key The Performance Indicators?

Introducation

A balanced score card is a toll that is used to identify and improve different internal functions as well as their effects to the external environment, basically, it is a strategic performance management tool (De Geuser et al, 2009). The score card in the LFR Limited basically focuses on ensuring that the customer is treated with the best care and is comfortable. The procedures and activities carried out to ensure that are those that are mentioned in the score card. The business’s aim is to be able to attract new customers as well as maintain its current customers. Therefore, the management team of the business focuses on ensuring that all of the above business functionalities are performed to their optimum and achieved the results intended.

Objective Measure In Form Of Kpi

The internal perspective measures implemented in an organizational level cannot be implemented in an individual store mainly because of:

The individual stores may not afford to employ as many employees as an organizational store. And therefore will lack the effective and efficient customer experience

An individual store may not afford to employ the number of managers needed to implement the measures or strategies which may lead to poor judgment and decision making processes

In most private or individual businesses, the employees should not be seen forming any relationship which reduces the chances of the customer engaging in a close relationship with the employees

In most individual businesses, the business operations are run from debts, or rather its funds are mostly received from loans and debts. Therefore, the opportunity to offer some special treatment to the customers becomes an additional expense hence it is not done.

KPIs Necessary in Individual Businesses

1. a) Operational KPIs

These relate to business operational efficiency. In most businesses, the daily operations include activities like product purchases, customer care and treatment, product sales to name a few. The operational KPIs are used to measure how long a business takes to complete a certain operation and succeed (Velimirovi? et al, 2011). Therefore, in the case of individually owned businesses, this KPI is needed to measure the actual performance of a business operations on a daily basis. These daily measurements can help a business to predict its future or final performance.

1. b) Growth KPIs

These relate to overall business growth, whether in terms of increase in customers, increase ofproduct sales volumes or increase in number or employees and business expansion (Carlucci et al, 2010). Apparently, by attracting more employees, a business will certainly attain more revenue and increase its sales volumes. Therefore, according to Eckerson, 2009, individually owned businesses should ensure the implementation of this KPI measure.

1. c) KPIs link to LFR’s Strategy

References

Carlucci, D., & Schiuma, G. (2010). Determining key performance indicators: An analytical network approach.

De Geuser, F., Psychology, S., & Oyon, D. (2009). Does the balanced scorecard add value? Empirical evidence on its effect on performance. European Accounting Review, 18(1), 93-122.

Eckerson, W. W. (2009). Performance management strategies. Business Intelligence Journal, 14(1), 24-27.

Velimirovi?, D., Velimirovi?, M., & Stankovi?, R. (2011). Role and importance of key performance indicators measurement. Serbian Journal of Management, 6(1), 63-72.