Performance measurement Essay
Economic Value Added (EVA) is a tool used to measure how efficiently an organization uses its resources. This tool is basically the difference between the returns on the resources invested and the amount of resources invested in the organization. If an organization has a higher value of EVA then it shows that the company’s performance is at a reasonable level. In the calculation of the EVA interest is not considered to be an expense because it is a part of the capital of the organization. Market value added is the difference between the actual market value of the organization and the capital that has been invested in the organization.
An increase in the market value added indicates that there is a positive economic value added and it also shows that that the organization is creating wealth. The 360 degree performance test is commonly used by organizations in the management and leadership programs meant for the organization’s development. In this method the participant completes a self assessment test and then collects views from different sources which include peer employees, supervisors and subordinate staff. This method gives the employees an understanding of their weaknesses and areas where they are strong.
The employees are then
Need essay sample on "Performance measurement"? We will write a custom essay sample specifically for you for only $ 13.90/page
Performance measurement in projects is important for a number of reasons; first it provides a means to define the program service levels at the strategic level and at the operational level. Performance measurement also provides the clarity of the project and shows its importance to the community. Performance measurement systems also provide a well working methodology of reporting any project accomplishments to the supervisors or the managers of the project. Performance measurement is also used to determine how efficient are the current resources being utilized (Allen and John, 1996).
It can also be used to measure the weaknesses and strengths of the project so as to come up with improvement measures for efficient running of the project. The data provided by the performance measurement tool can be an effective tool to influence political decisions for the improvement of the project. Strategic performance measures are important because they address the community’s strategic plan in an all round manner as compared to the operational performance measures. WORD COUNT 860 WORDS REFERENCES LIST
Allen, John R. (Aug. 1996). The uses of performance measurement in government. Government Finance Review 12(4), 11-15 Dean R. Spitzer, (2007), Transforming performance measurement: rethinking the way we measure and drive organizational success, AMACOM Div American Mgmt Assn, 2007, pp 42-44. Hatry, Harry P. , Richard E. Winnie, & Donald M. Fisk. (1981). Practical program evaluation for state and local governments (2nd edition. ). Washington D. C. : The Urban Institute Press.