Business Performance Measurement Research Articles

Performance Measurement of Islamic Bank in Indonesia, is Merger Necessary?

In 2021, Indonesia’s administration decides to conduct a merger among Islamic government bank. The emerge of syariah financial market is the reason of this policy. This study analyzes Islamic banks merger policy by assessing their financial performance. The purpose of this study is to analyze financial efficiency of Islamic Banks and Conventional Banks in Indonesia based on the 2019 financial reports by using the Data Envelopment Analysis (DEA) method. Practical contributions of this study for the banking industry was as a guidance for the management in measuring banking activities by analysing the efficiency level so that it can be used to compile business strategies. Basically, financial performance analysis is the result of evaluation of past performance. In this study, we use different analyses in order to obtain a company’s financial position that represents the company’s reality and potential for continuous performance. Business performance represents effectiveness and the efficiency of an organization or company. Company or organization assess their performance to understand their achivement and evaluate their business plans. In this study we developed business performance measurement based on input and output of Islamic and conventional banks in Indonesia. We employ Data Envelopment Analysis which calculate the ratio between output and input. In this study, we use deposits, fixed assets and labor costs as input, while credit or financing and operating income as output variables. In this study, we find that there are several conventional and Islamic banks that suffers inefficiency. This inefficiency occurs due to the ratio of inputs and outputs in conventional and Islamic banks are not optimum.

Social business performance: is it possible to measure? Review and research agenda

Objective: This article proposes a systematic review of the literature on social business performance (SBP) measures to analyze its current panorama of studies and propose a research agenda. Methodology: A mixed approach, quantitative regarding the use of descriptive statistical analysis, and qualitative regarding the content analysis. The research considered 241 peer-reviewed journal articles extracted from the Scopus database in English from 2010 to 2021, of which 34 comprised the qualitative analysis. Results and Conclusion: The results reveal a growing interest in this field of research in recent years, especially from 2017 to 2020. Most studies on SBP are concentrated in North America, specifically in the United States (52 articles). Subjective scales are the most frequent as SBP measures, and the scale developed by Miles et al. (2014), which addresses economic and social performance, was the one that stood out the most in the studies. Of the 34 articles that constituted the qualitative analysis, a research agenda composed of four categories can be established. Research implications: The study contributes to research in ​​social business, primarily social and economic performance, evidencing a perception of the evolution of SBP studies in the last ten years. Originality/value: It presents the objective and subjective SBP measures adopted in scientific production. It also presents an agenda for future research that covers the application of studies in other contexts and sectors. The research focused on longitudinal studies, quantifiable and objective measures, and comparisons between social and traditional businesses.

Rethinking business performance in global value chains

This paper develops a theoretical foundation for rethinking business performance in global value chains amid the Covid-19 fallout. Specifically, we synthesize business performance into three potentially reinforcing but also conflicting performance systems: 1) operational efficiency, 2) market effectiveness and 3) financial resilience to examine their effect on a) profitability, b) growth and c) solvency. While some specific measures of business performance will suffice in times of stability and growth, they could make firms operating in global value chains vulnerable in times of adversity. Our comprehensive theoretical framework contributes to our understanding of the dynamic interplay of conflicting performance systems. We discuss implications for assessing business performance and provide directions for further research.

Measuring the performance of a private higher education institution in South Africa

This article postulates a model to measure the business performance of a private higher education institution in South Africa. The broad theoretical framework identified 15 antecedents and their respective measuring criteria to measure business performance. Statistical scrutiny ensured that these criteria are actual measures of the respective business performance antecedents, which culminated in a theoretical model to measure the business performance of private higher education in South Africa. The 15 business performance antecedents are sales, growth, profitability, technology, customer, innovation, service, leadership, return on investment, stakeholders, society, quality, marketing, communication, legality, and general measures of business performance. The results showed that all the antecedents are reliable indicators of business performance. The performance of a private higher education institution can be successfully measured and it is possible to determine whether the demographic variables influence the business performance antecedents. Besides, the model seeks to determine whether any significant correlations exist between the business performance antecedents. The measurement of business performance is valuable to business school directors, managers and investors in private higher education. Researchers and scholars who intend to explore this avenue of business performance models further could also benefit from this article.

Trends in small business performance measurement research: a review of 25 years literature

This research is possibly the first of its kind to present a thorough analysis of performance measurement approaches in small business researches. To make this study centred on small business, we selected the journals that are primarily meant for small businesses and have a high impact measured through their cite score. We picked up the primary research articles carrying performance in their title and measurement of overall performance. We then applied the content analysis technique to analyse the performance data. The analysis brought several crucial findings concerning the trends in publications, usage of different measures, choices of financial and non-financial measures, and aptness of the subjective and objective approach. Besides these, the study also laid out their implications and future directions.

Trends in small business performance measurement research: a review of 25 years literature

Trends in small business performance measurement research: a review of 25 years literature

Tactical economic business performance measurement system for urban public transport

Tactical economic business performance measurement system for urban public transport

Tactical economic business performance measurement system for urban public transport

With the emergence of new transportation modals, a large part of the population has been looking for better cost-benefit means of transportation. In this context, public transport by bus remains the most traditional, safest, and environmentally sustainable. The present study aims to identify the performance measurement level of tactical economic business aspects of urban public transport to provide a more effective service. A hierarchical structure based on the analytic hierarchy process composed of fundamental points of view and key performance indicators was developed, applied to a university bus line case study linked to the public transport system in the City of Santa Maria, which presented a moderate performance.

Are reported greenhouse gas emissions influencing corporate financial performance?

Research Question: This paper aims to analyse the impact of reported greenhouse gas (GHG) emissions on financial performance of companies operating in the chemical industry from Central-Eastern Europe over the period 2015-2019. Motivation: Currently, the climate change and global warming have become highly topical due to their progressively visible destructive effects worldwide on the environment, society, and economic activity. Idea: To offer the suitable information to all its stakeholders, each company should identify the necessary information, measure it, make it useful, and take reasonable steps to ensure that it’s accurate; our research investigates the effect of reported greenhouse gas emissions on return on sales, as a measure of business performance. Data: The paper is based on panel data extracted from non-financial and/or annual reports for the top 10 largest companies operating in the chemical industry geographically located in Central-Eastern Europe covering the time frame 2015-2019. The final sample consists of 34 firms and 134 firm-year observations. Tools: A multiple linear regression model was designed and applied, having return on sales as the dependent variable and GHG emissions as the independent variable. Findings: The findings of our study confirm that a lower level of GHG emissions will generate an increase in return on sales, consequently, the environmental performance reported in terms of controlling for GHG emissions enhances the financial performance measured as return on sales ratio. Contribution: The paper contributes to the literature on climate change, revealing a negative, but significant effect of GHG emissions on financial performance and endorsing that companies which today pay less attention to this global concern, tomorrow will face difficulties in terms of sales.

The Impact of Quality Management on Business Performance of Manufacturing Firms: The Moderated Effect of Industry 4.0

Purpose: The research aims to investigate the individual quality management (QM) factors impact on business performance in manufacturing firms. We then assess their influence and look at how industry 4.0 affects business performance directly. Furthermore, the study will demonstrate the moderate effect of industry 4.0 on the interaction between QM and business performance. Methodology/Approach: The authors used two methodologies. The first is qualitative methods, by interviewing experts to develop a realistically appropriate model. The second is quantitative methods, by carrying out the survey and getting 84 observations. This research used the multivariate data analysis technique PLS-SEM to evaluate three measurement models: formative measurement model, reflective measurement model, and structural model. Findings: The QM was operationalised as a multi–dimensional construct. According to the findings, these individual QM factors significantly affect the organisation’s performance, including customer satisfaction, employee satisfaction and quality performance. Besides, QM and Industry 4.0 have directly impact on performance. The study also shows that industry 4.0 has a positive moderating role in the relationship between QM and business performance. Research Limitation/Implication: The survey was only done in emerging countries and the sample size is limited. There are other QM and business performance measurement parameters that have not yet to be discussed. Originality/Value of paper: The study contributes to the QM literature by building a business quality model, in which the role of Industry 4.0 was explored.

Management practices and their relation to success of Polish SMEs: The empirical verification.

The aim of the paper is to identify management practices that are characteristic for SMEs that achieve market success measured by their business performance in last their years of their operation analyze the relationships between management practices applied in small and medium-sized enterprises and their success measured by their business performance drawing on the data from 2710 SMEs operating on the Polish market. A cluster analysis was used to distinguish homogenous SME groups in view of their management practices. We examined differences between groups in terms of their business performance. The HINoV algorithm allowed six variables to be selected out of 32 management practices chosen initially for testing, with these variables providing the basis for grouping. Modal values and medians were calculated for 17 business performance measures in the three clusters produced. The subsequent analysis of those findings was focused on capturing significant differences. In the group of 2710 Polish SMEs, it was possible to verify that there existed an association between management practices in the field of modern HRM, computer systems supporting management and the company's economic performance, as measured by an increase in net revenue and number of customers over the last three years. In clusters where the above mentioned practices were appreciated, modal and median values of the increase reported in net revenue and number of customers were significantly higher. The research has shown that at a time marked by a shortage of highly skilled personnel one should pay particular attention to building an integrated and committed team of workers and to employee empowerment. The research has also shown that SME managers monitor only a fraction of basic business performance measures, which may prove to be a major risk to SMEs. Previous studies have been largely conducted in a fragmentary manner, i.e. they were concerned with the relationships between the application of some practices (strategic management, BPR, entrepreneurial orientation, monitoring, etc.) and selected business effectiveness measures. In this paper, the research covered SME management practices from a variety of areas which were then compared with the entrepreneurs' assessment as to whether the company's economic condition changed over the last three years. It is also the first attempt in post-socialist economies to identify those SME management practices that are related to better economic results.

Private Higher Education Institutions in the Digital and Pandemic Era

Enterprise risk management (ERM) is created to identify risks and helps organizations to achieve their targets successfully with less obstacles. ERM is to assist senior management be more aware of the increasingly wide spectrum of threats affecting them and thus more proactive, taking action to avoid what they can but also prepare for worse case scenarios to lessen the damage of events that are out of their control. ERM as an important part of a business performance measurement systems, in managing risks and uncertainties, for the successful implementation of strategic initiatives of an organization. ERM acts as an internal control mechanism with safeguard which provides rule and regulation, policies and guidelines. The main risk management standard that has been developed is the ISO31000 which provides a statement of risk management principles, as well as a description of the risk management framework and process. One of the standards which involve technology in risk management is ISO27000. It provides the overview of information security management systems (ISMS). While the environment of constant change and disruption creates opportunities for institutions to differentiate themselves in a crowded market, it also creates a growing array of risks that can quickly derail their strategy. Further, institutions should consider developing an “integrated and enterprise wide” approach to risk management, as opposed to siloed plans that exist within specific divisions or units to deal with risks specific to their overall institutional function or mission. This paper offers the conceptual integrated ERM (IERM) business model, in the form of Business Model Canvas (BMC), for private higher education institutions’ (PHEI) ability to generate adequate revenue and, in some cases, to even exist. Business model risks challenge an institution’s ability to remain relevance in an environment where new approaches to education delivery, revenue generation, and enrollment are evolving rapidly. PHEI that do not plan for these factors through innovation, enhancing productivity, and leveraging and protecting their strategic information and digital asset may find themselves outpaced by more agile competitors. Especially, during this era of globalization, digitalization and pandemic that have constantly change the livelihood and economic of nations, institutions, businesses, and people.

Examining the cash flow statement relevance for measuring the business performance in Nigeria

The study examined the relevance of the statement of cash flow in the measurement of Business performance. The methodology used is a review of relevant and extant literature, First Bank share prices from 2012 -2021 after which a conclusion was made. Statement of cash flow has been a subject of debate among scholars due to some limitations in the preparation of cash flow statements. It was revealed that First Bank share prices that rose from all-time low in 2015 and 2016 to a sudden upsurge in 2018 is a reflection that the share prices did not reflect the intrinsic value of the firm. The information in the financial statement was not adequate to guide the various stakeholders. Failure of First Bank to disclose Central Bank of Nigeria forbearances, amount to material misrepresentation and led to a bubble of the share prices. The quick pick-up of the share prices after the sacked of FBN management is evidence of some investors ' belief in the bubble share prices.

The impact of lean manufacturing practices on operational and business performances at SMES in the wooden furniture industry

PurposeFirst, this study aims to examine the level of implementation of lean manufacturing (LM) practices by the small- and medium-sized enterprises (SMEs) in the wooden furniture industry in Jepara. Second is to examine the impact of LM practices on operational performance (OP) and business performance (BP). Third is to examine the impact of LM practices on BP with OP as a mediating and moderating variable. OP is the quantifiable aspect of the process of an organisation, such as production cycle time, reliability and inventory turnover, whereas BP is usually related to the responsibility of the firms to their shareholders and has the goal of profit maximization.Design/methodology/approachThis study used primary data collected through an offline questionnaire. The questionnaire was intended to identify the extent of the implementation of LM practices and the level of OP and BP achieved by SMEs. The LM practices consist of 6 dimensions with 26 indicators; OP, 4 dimensions with 11 indicators; and BP, 3 dimensions with 9 indicators. The data obtained from the questionnaire were processed via partial least squares (PLS) regression using the SmartPLS software. PLS is generally used to assess the extent to which LM practices predict values in OP and BP.FindingsA total of 100 questionnaires were administered, of which 81% were properly filled, completed and returned. The result of the study confirms that LM practices should be applied collectively and comprehensively as each practice is interdependent. Moreover, it confirms that these practices have a direct effect on OP and BP and that OP can drive broader BP measures. Finally, the result confirms that these practices can improve BP indirectly with OP as a mediator variable. While the empirical evidence in this study supported the role of OP as a mediating variable between the implementation of LM practices and OB, it did not support the role of OP as a moderating variable.Research limitations/implicationsFirst, it is arguable that LM practices, OP and BP are only measured by the Likert scale, which would likely create bias and inconsistency from the owners or managers of SMEs in expressing the level of LM practices and performances achieved by the SMEs in the wooden furniture industry. Future research may help establish qualitative approaches to better measure the LM practices as well as the OP and BP through observation and probing. Second, this study was limited geographically (limited to only the SMEs in the wooden furniture industry in Jepara and did not cover all regions in Central Java as well as in Indonesia). Therefore, a wider geographical area could be considered, including the other regions in Indonesia which also produce wooden furniture.Practical implicationsThis study practically contributes to the LM body of knowledge by identifying the relationships among the LM practices, OP and BP in SMEs. Understanding these relationships will help the owner or managers of SMEs make better decisions in achieving the OP and BP. The owner or managers of SMEs who implement the LM practices individually may experience disappointing performance results as these practices should be applied collectively and comprehensively.Social implicationsThe LM practices may help the owners or managers of the SMEs to be competitive and achieve the optimum result.Originality/valueThis is the first known study that adopts the PLS framework to examine how OP measurement affects the relationship between the LM practices and BP in the case of the SMEs in Indonesia.

An empirical investigation of the relationship among agile manufacturing practices and business performance: a pilot study

PurposeAgility addresses vibrant solutions for running companies to meet the dares of customers asking for high quality and low- cost goods and services. The purpose of this study is to identify the practices for the successful implementation of agile manufacturing and measure their relationship with business performance measures of the manufacturing industry.Design/methodology/approachThe data for the pilot study were collected from 26 respondents through a questionnaire survey. After confirming the normality and reliability of the data, it was analyzed to examine the relationship between agile manufacturing practices and business performance measures.FindingsThe results show that there are strong relationships between agile manufacturing practices and business performance. Further, these attributes significantly contribute to delivering better business performance.Originality/valueThe study signifies the need for agile manufacturing in enhancing business performance for the growth and sustainability of the organization.

INFLUENCE ANALYSIS OF REWARDS & MOTIVATION, COMMUNICATION, DEVELOPMENT, SUPPORT SYSTEM, EMPLOYEE SELECTION, EMPLOYEE RECRUITMENT, AND HEALTHY WORK ENVIRONMENT ON INTERNAL MARKETING (CASE STUDY AT PORT DIVISION BONTANG COAL TERMINAL PT INDOMINCO MANDIRI)

Internal Marketing is the important aspect at the organization to measure business performance. The job of internal marketing is to recruit, train and motivate employees who can serve customers well. Without being actively promoted, internal marketing can have a negative impact on service quality, which can lead to decreased customer satisfaction and profitability. This study is focused on the services division especially in port division Bontang Coal Terminal PT IMM. Researchers took research data through a Google Form questionnaire. There are 84 respondents were recorded as filling in the questionnaire to test all the hypotheses. There are 7 indicators used to assess internal marketing. The data analysis used PASW Statistics 18 to test the level of validity and reliability, to test the results of the hypothesis, the researcher used SEM PLS to determine the relationship between variables. The findings of this study are that the Rewards and Motivation, Communication, Development, Support System, Employee Selection, Employee Recruitment, and Healthy Work Environment have positive significant on Internal Marketing

Digitalizing procurement: the impact of data analytics on supply chain performance

PurposeThis study aims to investigate digitalization as a performance driver in supply chains, especially the role of data analytics in the digitalization of procurement. The study investigates how digital procurement capabilities are linked to data analytics capabilities and supply chain operational performance and how this links to business success.Design/methodology/approachUsing operational and dynamic capabilities as foundations for data analytics capabilities, this paper studied the digital procurement capabilities and proposed the conceptual model and hypotheses for empirical testing. The collected industry survey data and structural equation method are then applied to test the hypotheses.FindingsThe study confirms positive and significant relationships among digital procurement capabilities, data analytics capabilities and supply chain performance. Digital procurement capabilities mediate the positive relationship between external data analytics capabilities and supply chain performance.Research limitations/implicationsThis study has some limitations that should be addressed. The empirical study was based on survey data from a questionnaire that was probably challenging for some respondent companies with low levels of digital procurement and data analytics. Also, it is necessary to adopt secondary data to measure business performance in future studies which reduces the effect of subjective bias.Practical implicationsFrom the managerial point of view, the findings highlight the importance of gaining knowledge from gathered data and digitalized processes. Managers must focus on data utilization capabilities to improve the operational performance expected from the digitalization of supply chain activities. In addition, managers need to consider exploiting of data through new creative approaches as part of standardized operations.Originality/valueThe present study contributes to existing knowledge by investigating the mediating role of data analytics capabilities between the digitalization of procurement and supply chain performance. The findings support a positive relationship between the data analytics capabilities and supply chain performance in digital upstream supply chain procurement processes. The present study also clarifies the impact and role of data analytics capabilities in digital supply chain development and success.

Does the ideal entrepreneurial team exist?

Up until now, studies on entrepreneurs and their relationship to business performance have focused primarily on analyzing the entrepreneur as an individual. While studies have been conducted on the entrepreneurial team, their focus has centered on team size and degree of diversity - cultural, age, gender - leaving a gap in the analysis of the effect of a team’s competencies on the outcome of the ventures. This research aims to help fill this gap by using the psychometric instrument DISC. This research analyzes entrepreneurship by opportunity, evaluating the performance of 109 Colombian companies and the composition of their entrepreneurial teams. The results obtained provide the basis for better understanding of the make-up of entrepreneurial teams, considering the variances and interdependencies of the competency development level among their members. They reveal that identifying the similarity or heterogeneity in certain groups of competencies, as well as how developed they are, can have an impact on the ventures’ success. The cluster analysis carried out suggests that highly developed competencies associated with the ‘dominance’ dimension in the members of an entrepreneurial team are essential. These must be above-average in heterogeneous levels among the team members. They must also be accompanied by the ‘steadiness’ competency provided by the team-oriented partners, as well as an average, homogeneous level of competencies associated with ‘conscientiousness’ if the new business is to achieve good financial results in its early years. The ‘influence’ dimension did not play a significant role. The teams made up of more homogeneous partners obtained the poorest financial results. Furthermore, the study provides new perspectives for measuring business performance in a venture, as well as for evaluating the relationships between the entrepreneurial team's competencies and the company’s results in the first years of business. Accordingly, it offers inputs for future research.

KELAYAKAN FINANSIAL DAN PENDAPATAN USAHA BUDIDAYA IKAN PATIN STUDI KASUS DI CV XYZ KECAMATAN BUMI RATU NUBAN KABUPATEN LAMPUNG TENGAH

Patin fish culture requires a large amount in terms of cost in its implementation. This study aims to analyze business performance financial, production, and marketing aspects. The research method used is a case study in CV XYZ in Central Lampung District conducted in May-June 2019. Measurement of business performance from a financial aspect uses NPV, IRR, Net B / C, Gross B / C, and Payback Period with 12% interest rate. Measurement of business performance from the aspect of production uses the calculation of productivity and income during season one and season two. The study concludes that the patin fish culture business per 1,000 m2 was profitable to run, seen from the IRR value at 13.06%, NPV at 22,671,483.98, Net B/C at 1.05, Gross B/C at 1.01, and Payback Period at 7.67. The patin fish culture business from the aspect of production has been profitable based on the productivity obtained, namely per pond of 1.000 kg in season one and 750 kg in season two, per hectare at 50,000 kg in season one and 37,500 kg in season two.Key words: financial, income, patin fish

Banking Business Performance Evaluation Using Standard Model of Quality Management Europe – EFQM (European Foundation for Quality Management): Case Study in Bank Bjb (Jabar-Banten) Tbk.

This is paper research case study to examine application evaluating and measuring business performance banking company using concept International Quality Standard of Excellences Model European Foundation for Quality Management (EFQM - 2013) with ten (10) variables: Case study in Bank Jabar Banten Indonesia (PT. Bank Bjb Tbk). The study examines the organization productivies, effectiveness and efficiencies, and the level of company performance comply with role and regulation of banking authority. The variance was explained by extraction factor sums squared loadings of the information yielded in business performance of firms. The main of findings showed that all the two (2) variables i.e. Leadership and Partnership Resources are less influence the business performance of PT. Bank Bjb Tbk. The novelty of this research study are the understanding the excellent level of capability of business performance firms; realized the actual quality practices have significant positive effect towards business performance banking ; including the necessary improvements to be carried-out by the companies involved.