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Course: Advance Diploma of Leadership and Management

Unit: BSBMGT617 Develop and Implement a Business

Plan Assessment 3 Overview:

1. Submit a report on monitoring the progress of performance measure system on

the business plan (use business plan developed on assessment 2).
1. Key Performance Objective/s:

Key result area

Key result area Key performance indicator

Return/Profits 5% return on investment
10% increase in net profit before taxes
Percentages of gross margin increase by 15%
Productivity Unit per month increase by 10%
Output per employee increase by 5%
Turnaround time decreased
Overtime per employee decrease by 10%

Financial/non-financial performance

Financial performance Non-financial performance

Customer preference ranking Employee turnover
Time between customer order and product Transaction processed
deliver
Percentage of delivery on time Number of defective

Financial objectives

Effective business plans include financial objectives: ways to measure the fiscal performance
of a firm that demonstrate the owners’ ability to pursue their business objectives and prove
the organization’s long-term viability to various stakeholders: employees, customers,
suppliers and creditors. While at the most basic level the balance of receipts and payments
indicate commercial gain or loss, a small business can use a variety of specific objectives to
appraise its value, emphasizing one or a combination of some measures over others
depending on the business structure, such as the number of owners responsible for the
business, the nature of the industry or the types of financing used to raise capital.

Non-financial objectives

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 These particular objectives are associated with few factors , such as , their workers
( management and employees ) and social responsible , provision of certain level of service ,
obligations toward customers and suppliers , and lastly , the growth , diversification and the
leadership style in term of research and development .
 Identify at least one financial objective and one non-financial objective from the
business plan (assessment 2)

Financial objectives:

Maximizing Profits

Usually the most widely used objective, most firms look to maximize profits to
recompense investors for taking a risk in the venture. Managers should measure
both profit levels: gross profit or the total revenue minus direct costs of the product
or service in question; and net profit, or the income left after operating expenses.
Managers can focus on improving different aspects of their operations by
determining which margin runs too thin.

Non- financial profit:

Customer Service

Just as most companies depend on their employees to generate financial success,

organizations also depend on income from customers who buy the products and
services. Recognizing the risk of reduced revenue if quality problems drive customers
to competitors, many businesses implement rigorous quality standards and measure
customer service results through numerous statistics and metrics to ensure
customers receive the best possible products and service. Non-financial objectives
like the percentage of faulty products or the time taken to answer customer calls
help organizational leaders gauge the effectiveness of customer service programs,
and many companies constantly assess their customer service objectives to ensure
customer satisfaction.

2. For each objective/s:

Financial Objective: Maximizing profits

• describe the performance measure system

Return of Investment ROI

A performance measure used to evaluate the efficiency of an investment or to
compare the efficiency of a number of different investments. ROI measures the
amount of return on an investment relative to the investment’s cost. To calculate

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 ROI, the benefit (or return) of an investment is divided by the cost of the investment,
and the result is expressed as a percentage or a ratio.

• identify appropriate timeframe to monitor performance

For the financial objective a timeframe for monitoring the performance must be
allocated so that performance can be measure and appropriate changes could be
made to make the objective more specific and realistic. The timeframe should not be
too near each timeframe and shouldn't be too far apart. In this case a timeframe of
Quarter will be take place. Financial objective will be monitor in a monthly basis but
the overall report will be monitor in a quarterly basis.

• identify relevant stakeholders who will require the information

 Managing Director – responsible for daily operational management decisions

 Logistics Manager – responsible for the scheduling of the trucks and drivers
 20 truck drivers
 5 office support employees – responsible for administration, accounts, human resources and
sales

• describe the benchmarking used to determine the suitable performance measure

Benchmarking involves measuring the performance of your business against a

competitor in the same market. Comparing your business to others is a valuable way
of improving your understanding of your business performance and potential.

Benchmarking your business will give you insight into how well each aspect of your
business is performing, allowing you to discover in which areas you need
improvements, and help you develop a plan towards achieving those improvements.

Trend analysis

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 Trend analysis is the process of comparing business data over time to identify any
consistent results or trends. You can then develop a strategy to respond to these
trends in line with your business goals.

Trend analysis helps you understand how your business has performed and predict
where current business operations and practices will take you. Done well, it will give
you ideas about how you might change things to move your business in the right
direction.

Non financial objective: customer service

• describe the performance measure system

Employee Survey Questions and Questionnaires

The employee engagement survey is probably the most common way for managers
to understand what their teams think of their jobs and the firm that employs them.
By measuring employee responses to survey, the organization can identifies the level
of employee alignment with the organisation's strategic goals, the level of employee
engagement and exactly what is driving employee engagement.

• identify appropriate timeframe to monitor performance

Quarterly basis
In order to understand better on the customer services area, the business must
always be available to monitor the performance. A quarterly basis timeframe
to monitor the performance is the best fit for these non-financial objectives.

• identify relevant stakeholders who will require the information

 Managing Director – responsible for daily operational management decisions

 Logistics Manager – responsible for the scheduling of the trucks and drivers
 20 truck drivers
 5 office support employees – responsible for administration, accounts, human resources and
sales

• describe the benchmarking used to determine the suitable performance measure

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 Strategy benchmarking
When you include strategic benchmarking in your planning, you can compare your
improvements in strategic performance to that of performance leaders in your field
of activity in addition to comparing them to the past performance of your own
business

3. Summarize the above information into a table with the following information:

Key Stakeholders Type of reports Timeframe Benchmarking methods

Managing director Return on Every three Process benchmarking is
Management team investment months a business function that
Sales Manager compares specific
Finance manager processes to a leading
Logistic manager company or an industry
HR manager standard
Sales manager Productivity and Every month Peer benchmarking - This
Finance manager services output is a benchmark report
Logistic manager where companies choose
Management team to look at other
businesses very similar to
themselves. This allows
companies to make sure
they are staying
competitive with similar
businesses.
HR manager Customer survey Every three Performance metric
Logistic manager report months yields results that
Sales manager measure clearly defined
Management team quantities within a range
that allows for
improvement. Companies
base good performance
metrics on verifiable data
and use metrics that they
can reproduce as needed,
to allow for comparisons.

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