Measuring Performance Essay Example | Topics and Well Written Essays - 2750 words

Measuring Performance - Essay ExampleThis report is fundament wholey structured in two parts such that first part of the report highlights financial analysis of FDP with the help of ratio analysis. Last part of the report evaluates the non-financial indicators through equilibrate Scorecard. Conclusion is provided at the end of this report which summarizes the performance of FDP. Background Information Cut throat competition, shrinkage in profits and increasing redundancies turned discover to be the prime factors that lead FDP to change its business strategy. The beau mondes streamline business used to have both non-urgent and urgent bringing outline of the parcel from both mail order companies as well as from internet retailers. The normal non-urgent parcel delivery system used to take well-nigh 5 to 7 working days but due to excessively increasing and tightening situation of competition especially with the entrance of international players, it has drive extremely difficult for FDP now to survive in such closed competitive environment of the non-urgent parcel delivery system. The board of directors of the company has realized all the situations and considered different options in order to boost the revenues of FDP. The final strategy that has been selected by the board is the discontinuance of the non-urgent parcel delivery system by replacing a fast urgent delivery system which would ensure that every parcel is delivered to its recipient within 2 hours of the order booking. Such adoption of the strategy requires significant amount of investment in the existing operations of the business as the company requires more infrastructure and advancements in its communication and information technology ground machines. It is intended to provide the parcel delivery personnel a notebook computer along with a parcel scanner such that they are connect with the central database system of FDP. Through all this communication devices, the tracking, collection and deli very of parcels would be delivered with much more convenience as well as ensuring their delivery less than 2 hours. The board has also decided to charge the premium price in respect of the urgent delivery system from the customers. Impact of death penalty of New Strategy upon the Financial Performance of FDP This strategy would be implemented from 1 December, 2011. Therefore, the impact of the change in strategy would definitely change companys financial performance for the upcoming year. The performance of the company in respect of its profitability, leverage, efficiency, liquidity and financing has been discussed as under Profitability Profitability is the more or less highly concerned area of financial performance as it is the basis upon which every business decision is taken whether it is small as per companys perspective or large. Whatever the decision the company takes, everyone is interested to know as what would be the impact of that decision upon the profitability positio n of the company. Generally in that location are few profitability ratios that actually highlight the profitability in terms of various different perspectives. Some of those ratios are discussed as under benefit Profit Margin The company was struggling to maintain a steady growth rate in terms of its Net profit Margin in the past two years but with the implementation of the new strategy, the company can stabilize the growth rate of net profit margin