Performance measures in the past primarily focused on production and were
aimed at attaining increased short-term operational efficiency in terms of
financial indicators. This type of measurement is too narrowly focused as it
ignores critical measurement indicators that makes or breaks the company
such as human capital, processes, customer interface, etc. In this regard most
African countries are finding it extremely difficult to compete in the dynamic
and changing global business environment.
This study aims to assess to what extent Eritrean manufacturing enterprises
use integrated performance measures, extent of its utilization and perceived
relevance related to their actual financial results. In this regard an integrated
model such as the balanced scorecard approach (financial, customer
satisfaction, internal process/operational and employee satisfaction
measures) was selected as reference for the study.
A survey was done to gather data. Qualitative and quantitative techniques
were employed for analyzing the data. The specific methods of data analysis
include descriptive statistics such as tabulation, cross tabulation,
computations of frequencies, and computations of percentages as well as
correlation and regression analysis. The relative importance of financial as
well as non-financial measures in relation to the performance evaluation
process in the context of manufacturing enterprises was investigated. The
result of the analysis indicated that the majority of respondent enterprises
primarily focus on financial measures, using historical data, accounting profits
and financial ratios which are compared with industrial trends. The financial
measures are considered as having great importance in the respondent
enterprises. Despite the fact that the non-financial measures are as important
as the financial measures - little or no attention is being paid to non-financial
dimensions. The result of the analysis revealed that there is a clear and
strong relation between the financial performance and the non-financial performance measures (customer satisfaction, internal process/operational
and employee satisfaction). In addition, empirical findings suggested that the
non-financial measures are significant explanatory factors of financial
performance. More importantly, findings show that manufacturing plants that
consistently employed both financial and non-financial measures performed
better than those that do not.
Based on the results of the study important policy recommendations are
outlined. Manufacturing enterprises have to invest in re-training employees to
get motivated and competent people to produce customer perceived product
quality as well as continuous improvement of operational processes, which
may help the enterprises to compete in todayâs dynamic business
environment. Generally the study has collected essential numerical evidence
for the future development of manufacturing enterprises. Knowledge and
understanding of the critical factors underpinning enterprisesâ performance
can lead to further improvements. In turn this will help the overall development
of the national economy.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:ufs/oai:etd.uovs.ac.za:etd-06282006-105902 |
| Date | 28 June 2006 |
| Creators | Weldeghiorgis, Kidusan Yohannes |
| Contributors | Prof A van A Smit |
| Publisher | University of the Free State |
| Source Sets | South African National ETD Portal |
| Language | en-uk |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.uovs.ac.za//theses/available/etd-06282006-105902/restricted/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to University Free State or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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