Prediction of Financial Performance from Business Excellence Scores-A Study on Companies in India

Abstract

In modern complexity of global competition and rapid technological advances, organisations have to rely on excellence practices to develop inherent strengths and innovation ability to defend their business and market share. Several studies have reported that excellence models and awards won by companies have helped achieve higher financial performance. A study was conducted in India on 75 sample companies that were top performer companies in India and listed in the stock markets. In this paper, we report on the findings of two group discriminant function analysis and correlation analysis based on newly designed measures of excellence, world class status and non-conventional financial measures like compounded annual growth rate and Consistency Score, a new variable used for the first time to attempt to find a cut-off score of excellence measures that can predict a high- or low-performing company.