Saturday, August 24, 2019

Measuring Business Performance Coursework Example | Topics and Well Written Essays - 1500 words

Measuring Business Performance - Coursework Example Kinney (2009) defines effectiveness is the state of doing the right things within and the limits that have been put, on the other hand efficiency is the state of doing things the right way. Effectiveness aims at outcome regardless of how resources are used while in efficiency focus on the process considering resource allocation. A good example is a company that deals with customer care services, if a worker achieves their daily target then they are effective. However, reaching targets does not mean all the calls successfully connected the customer. On the other hand, a worker may not reach the daily set targets but all his or her calls connect to customers, this is efficiency. 1. Efficiency and effectiveness enables a company saves resources and ensures maximum utilization of the same. When employees work efficiently, they utilize most of the resource with minimal or no wastage respectively. In doing so, the purposes for which the resources were intended for will are met. If efficiency is not there, some resources will be wasted meaning that new ones will have to be purchased thus affecting maximization of the resources. 2. Effectiveness and efficiency leads to expansion of a business. Through effectiveness company can meet targets and produce large volumes of quality goods per a given period of time. This means that the company will sell more goods per unit period. Increase in sales leads to purchase of new equipment that will demand space. The company will therefore expand so as to provide room for the equipment. 3. Efficiency and effectiveness increases profit margin of a company. When a company is efficient, it means that they are maximizing the use of the available resources. If effectiveness is applied, then the company will produce more commodities with minimum materials hence bringing up the profit margin of the company. Lyons (2013) note that in case of inflation, it is very hard to determine the performance of

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