Download Lesson 7

Q: Monty Burn’s Co. is the company that owns a Nuclear
Power station that supplies power to much of the state.
Evaluate the contribution of this LSO to the economy.
4 Marks
Q: Monty Burn’s Co. is the company that owns a Nuclear
Power station that supplies power to much of the state.
Evaluate the contribution of this LSO to the economy.
• Outline how LSOs both contribute positively and negatively to the
economy (keeping this general)
• Make a statement about how Monty Burn’s co. would have both
negative and positive contributions.
• Identify and explain at least one from both +/ve & -/ve
• Make a judgement as to whether overall this company is good for the
economy and defend this judgement (as per ‘justify’)
AGENDA
• Mind map – business environments
• Homework Questions + Case Study questions
• New content: Performance Indicators
Chapter 1: Activities - 1.3, 1.6 & Exam preparation
Questions 2-3 (page 25)
Chapter 2: Activity 2.1, 2.4, 2.5
LEARNING INTENTIONS
Students will be able to:
• Distinguish between efficiency and
effectiveness
• Identify and describe nine common
performance indicators
• Suggest and justify performance indicators for
use in measuring specific goals
Performance Indicator Terms
Efficiency – The way the organisation uses its available
resources to achieve its goals and objectives.
- Examine inputs/resources and how they are turned
into
outputs.
Effectiveness – The ability of an organisation to achieve its
goals and objectives
Performance Indicator Terms
Productivity – is a quantitative measure of efficiency, measuring
the relationship between inputs and outputs.
Performance Indicators – are criteria used to measure the
performance of the organisation in terms of efficiency and
effectiveness. They can be financial or non-financial.
Performance Indicators
Why? Tools to measure progress towards achievement of
organisational objectives. Can be:
Quantitative – measuring quantity
Qualitative – measuring quality (can be expressed in numbers
though). I.e. likert scale
Performance Indicators
Performance Measures must be:
• Relevant – does it measure what we want?
• Valid – can we (have we) collect(ed) the information?
• Reliable – source? Anecdotal or empirical?
VCE Performance Indicators you need to know:
• % market share
• Net profit figures
• Rate of productivity
growth
• Number of sales,
• Results of a staff and/or
customer satisfaction
survey
• Level of staff turnover
• Level of wastage
• Number of customer
complaints
• Number of workplace
accidents
Objectives – Management
Take notes on these 9 from your textbook
Management Functions
• Operations: producing the organisation’s final output (product or service)
• Marketing: Developing strategies to create an ongoing relationship
between the organisation and its customers (and to attract new
customers)
• Human Resources (HR): managing the overall relationship between an
organisation and its employees (contracts, training, negotiating pay
disputes etc.)
• Research & Development (R&D): studying & developing new and
improved products for the organisation
• Finance: planning, maintaining and reporting on the financials
(monetary) aspects of an organisation and its performance
Positive contribution of LSOs to the economy
•
•
•
•
•
Provide Employment : account for about 30 % of the workforce in Australia, with
Coles Myer and Woolworths. (LSOs make up only 3% of all businesses).
Contribution to research and development: LSOs undertake extensive R&D, and
thus produce many new products. They adopt efficient work practices and
innovative management ideas as a result. This will have an impact upon the
whole of Australian society, as these new products are implemented because
they increase productivity.
Gross Domestic Product (GDP): this is the total monetary value of goods and
services produced in Australia in a 1 year period. LSOs contribute about 50%55% of Australia’s GDP.
Contribution to exports: many LSOs export products O/S, eg Rio Tinto earns 90%
of its revenue from O/S. Exporting products contributes positively to our Balance
of Payment (BoP), as a favourable BoP exists when there are more payments
coming in to Australia than going out
Help infrastructure growth: roads, railways, ports, communication systems – all
improved and this assists economic growth, eg, upgrades to Monash Freeway and
Citylink estimated to deliver $14 billion in benefits through reduced travel time.
4 Categories of Objectives (pg 16-17)
• Financial: desired financial performance – maximising
profit, growing sales, expanding market share* etc.
• Service: meeting the needs of customers, i.e. reducing call
centre waiting times, adding online ‘chat’ help functions
etc.
• Ethical & social responsibility: participating in the
community as a ‘corporate citizen’. Can be in adopting
policies that reflect community values*, helping in the
community etc.
• Environmental: minimising use of natural resources and
the impact on nature of its business.
SMART Goals (pg 13)
•
•
•
•
•
Specific
Measurable
Achievable (but still challenging)
Relevant
Time-bound (they have a time frame to complete)
Stakeholders & the business environment
• 3 Levels
• Includes ‘stakeholders’