Calculating the influence of improvement measures on corporate KPIs
Master's Thesis from the year 2004 in the subject Business economics - Controlling, grade: A+, University at Albany, State University of New York, 15 entries in the bibliography, language: English, abstract: In order to do justice to the increased requirements on project and business controlling, there is a need for a systematic approach tailored to the corporation involved. Many corporations have been shown to prioritize improvement measures insufficiently, if at all, despite increased requirements on the economic viability of projects. Since resources are limited in all companies, improvement measures with the highest relative output should be given preference. The usual methods used up to now have been either inappropriate or are no longer sufficient. The Value Analyzer is a method-supported tool for estimating the expected improve¬ment of key performance indicators as a part of a general improvement in corporate performance. This makes it easy to focus on worthwhile measures and supports a general economic calculation to base a go/no go decision on before the start of an implementation project. Based on general key performance indicators, specific scenarios can be created and then altered and/or simulated by changing the parameters or factors of influence. This is all based on a three-level principle in the calculation model: • Definition of a primary goal, KPI (key performance indicator, for example inventory level) • Breakdown into part goals, KPI elements (performance indicator element, for example finished products inventory level) • Determination of appropriate measures for improving the part goal In the calculation of business scenarios that follows, the exact impact of enablers and the optimal combination of appropriate measures can be revealed, or possible measures can be prioritized according to specific aspects (e.g. effort in implementation). The more complex the situation, the higher the value added from the Value Analyzer’s structured solution.
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applied appropriate measures AROR Bradley University business scenario calculation example calculation form cash value cash-value method complex scenario corporate indicator Customer benefit data input mask data set decisions defined KPI Definition deliveries dimensions e-Enabler Element 3 Element Element 4 Element Element 5 Enabler evaluation Extract Factor p x q Factor x Figure flexibility forecast Illustration Impact Factor improvement report indicator system individual Industry Input Validation interest rate Inventory Costs inventory level Inventory Turnover investment involved key performance indicator KPI control KPI KPI KPI value KPI-Elements KPIs already matching matrix calculation Microsoft Access Monte Carlo methods Monte Carlo Simulation Opens a printable optimization phase possible predefined printable report prioritise Process Costs real options relationships requirements SBS MC selected KPI element Share Factor 20 share range Siemens Siemens Business Services specific strategic Supplier systematic approach target value tool transformation goals Turnover Value Analyzer value range