Posted: November 9th, 2022

Briefly mention the role of this method in measuring/assessing business

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please use the guide and include 10 citations and also include the references.
Part A:
Paragraph 1 (2 citations, 125 words)
• Identify and explain that businesses need to measure business performance by using measures which
are aligned to its strategic objectives– Wisner, J.D. and Fawcett, S.E. (1991)
• Introduce that businesses use both qualitative and quantitative measures in measuring business
performance. For example, Quantitative measures are numerical measures/metrics which gauge
business performance in tangible terms eg. Net Profit Margin, ROCE, Gross Profit Margin, Cost Benefit
Ratio etc. Such measures are usually SMART expressed for easier measurement and tracking of targets.
Conversely, Qualitative measures are non-numerical and subjective in nature which measure
effectiveness eg. the extent of employee satisfaction, employee loyalty, customer satisfaction, brand
equity, corporate social responsibility levels etc.
• Indicate that these measures are often linked to business drivers and company targets/objectives.
• Discuss the various ways your company uses both quantitative and qualitative measures to
assess/gauge/evaluate its business performance (See top of page 9). These include:
1. To assess contribution towards company outcomes eg. profits, competitive advantage.
2. To determine areas for corrective action or improvement
3. To hold staff/departments accountable for targets/objectives.
4. For tracking purposes
5. For comparison purposes against industry standards.
• Outline the major purpose of this essay- paraphrase from the question requirement – Part A. The
purpose of this essay is to discuss/assess the use of both quantitative and qualitative measures in
measuring business performance in your selected company.
Paragraph 2 (3 citations, 250 words, discussion of quantitative measures)
• Introduce that quantitative measures are numerical measures which are used to(they are basis of
performance measurement) (1) to gauge and track progress toward company targets especially
revenue, profits and operating expenses (2) to take corrective action to management strategies in
meeting targets (3) to hold staff accountable – use an overall citation here.
• Explain some of the principles of quantitative measures which include: (1) they are expressed in terms
of numbers, percentages, time (2) data must be collected against these measures (3) they are usually
SMART expressed (4) they should be congruent (see guide on this term) with other measures used by
the business or departments used within the business.
• Provide examples of quantitative (numerical) measures used in your business:
o Financial Measures: 20% Net Profit Margin and 50% Gross Profit Margin
o Human Resource measures: Employee turnover rate, payroll versus productivity.
o See page 29 of the ABE Study guide for more measures used in each business function eg. IT,
Marketing and sales etc.
• For each quantitative measure identified, describe how it is used in your business to assess the
particular function. For example, the business may use its 20% Net Profit Margin, expressed as a
percentage to determine its overall profitability and its ability to reduce its cost structures.
This can be useful to compare its 20% Net Profit position against rivals in the same industry. In
another example, using the employee turnover rate, HR measures the rate at which employees leave
and enter an organization which measures the rate staff leaves or stays with the company.
High turnover rates indicates that staff are not satisfied whereas low rates indicate staff are
satisfied and more likely to stay. With high rates having the tendency to affect workplace productivity,
employee morale of those who remain and increase recruitment costs, the HR department uses
employee surveys and exit interviews to determine reasons why employees are leaving to take
corrective action.
• Suggest a limitation in the use of quantitative measures used by your company to assess business
performance. For example, companies may not have the data collection capacity (people or systems)
to collect the data required to use the quantitative measure eg. turnover rate is the measure; where is
the data?
• Analyse a possible recommendation to improve on the identified limitation and how it can benefit the
business in measuring performance.
Paragraph 3 (3 citations, 250 words, discussion of qualitative measures)
• Introduce that qualitative measures are non-numerical measures which are used to (1) to gauge and
track progress toward company targets (2) to make corrective action to management strategies (3) to
hold staff accountable – use an overall citation here.
• Explain some of the principles of qualitative measures which include: (1) they are expressed as
effectiveness outcomes such as employee satisfaction or customer satisfaction rather than outcomes
of efficiency (2) data must be collected against these measures (3) they are subjective and opinion
related (4) used alongside quantitative or numerical measures.
• Provide examples of qualitative measures used in your business:
o employee satisfaction levels
o customer satisfaction levels
o Employee wellbeing levels
o Corporate social responsibility index
o brand equity levels
• For each qualitative measure identified, describe how it is used in measuring your business
performance. For example, customer satisfaction levels are determined using surveys and opinion polls
to determine customer satisfaction with the product/service and overall company experience. This
data can be used to plan new customer service initiatives and/or improve existing service channels eg.
website, call centers, online chat
• Suggest a limitation in the use of qualitative measures used by your company to measure business
performance. For example, such measures and the data it collects maybe disregarded by management
due to their perception of bias and subjectivity.
• Analyse a possible recommendation to improve on the identified limitation and how it can benefit the
process of measurement/evaluation. For example, qualitative measures should be used alongside
quantitative measures (or numerical methods) which can lead to greater objectivity in measurement of
the issue. The Balance scorecard which uses both types of measures should be used to gauge business
performance (use the citation on BSc from the ABE guide)
Paragraph 4 (1 citation, 80 words, Wrap up the discussion)
• Summarise the major qualitative and quantitative measures used by your organisation to assess its
business performance.
• Reiterate the various ways it can be used to assess/gauge business performance: (1) to track sales,
profits, market share, growth (2) to take corrective action when targets are not being reached (3) to
hold staff/departments accountable for results.
• Suggest that these measures should be used together rather than individually due to their individual
limitations.
• Recommend the balance scorecard approach (with citation) which uses both quantitative and
qualitative measures. Briefly mention the role of this method in measuring/assessing business
performance.

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