BUSINESS PERFORMANCE


Business performance assessment

All businesses were provided with a list of business performance measures and asked to indicate the extent to which they focused on these measures when assessing overall business performance during the year ended 30 June 2009. Businesses were asked to select one extent of focus for each type of measure.

Business performance assessment, by extent of focus(a)(b)(c), by type of measure, 2008 - 09
		Extent of focus
		Not at all	A small extent	A moderate extent	A major extent
		%	%	%	%
Type of measure
	Financial measures (e.g. profits, sales growth, returns on investments)	17.1	17.7	31.2	34.1
	Cost (e.g. budget, cost per unit of output, inventory cost)	18.3	21.2	33.3	27.3
	Operational (e.g. asset utilisation, on-time delivery)	26.9	22.6	30.1	20.4
	Quality (e.g. customer satisfaction, defect rates)	16.5	15.0	28.9	39.8
	Innovation (e.g. process innovation, new value added products)	31.7	26.9	27.9	13.7
	Human resources (e.g. job satisfaction, skills development)	28.0	29.1	31.7	11.3
	Environment (e.g. recycling programs, sustainability considerations, carbon footprint analysis)	34.8	32.6	22.8	9.9
(a) Proportions are of all businesses.
(b) Businesses were asked to indicate to what extent the business focused on the listed measures when assessing performance.
(c) The sum of component items for each measure may not equal 100% due to rounding and/or provision of multiple responses, refer to Explanatory Note 17.

When assessing business performance, 17% of businesses reported not focusing on financial measures at all, and 18% of businesses reported not focusing on cost measures at all, while the most commonly reported measure focused on to a major extent was quality (40%). Only 10% of businesses reported focusing on environmental measures to a major extent when assessing business performance.

At employment size level, 79% of businesses with 200 or more persons reported focusing on financial measures to a major extent, compared to 28% for businesses with 0-4 persons employed.

At industry level, the highest proportion of businesses focusing on quality measures to a major extent was in Manufacturing, at 47%. Electricity, gas, water and waste services reported the highest proportion of businesses which focused on environmental measures to a major extent (41%).

Innovation-active businesses (39%) were almost twice as likely to focus on cost measures to a major extent than non innovation-active businesses (20%).


Changes in business performance and activities

Businesses were provided with a list of measures and performance indicators and were asked to self-assess whether any of these had decreased, stayed the same, or increased compared to the previous year. An additional option of not applicable was also provided. Businesses were asked to select one indicator for each performance measure.

Changes in business performance and activities (a)(b)(c), compared to previous year, 2008 - 09
		Decreased	Stayed the same	Increased	Not applicable
		%	%	%	%
Performance measures and activities
	Income from sales of goods or services	32.9	18.2	38.9	10.3
	Range of products or services offered	5.2	61.1	18.8	15.1
	Profitability	35.6	27.3	27.5	10.0
	Productivity	16.4	44.1	23.0	16.7
	Total number of jobs or positions	15.0	57.1	14.8	13.6
	Export markets targeted	1.0	8.3	2.2	88.5
	Contracting out work/activities or outsourcing	5.3	19.7	7.8	67.3
	Structured/formal training for employees (d)	4.0	38.7	11.4	46.1
	Expenditure on Information Technology (IT)	6.7	37.7	20.1	35.8
	Social contributions (e)	6.1	38.1	10.9	45.0
(a) Proportions are of all businesses.
(b) Businesses were asked to indicate if there had been a change in any of the items listed compared to the previous year. No attempt was made to cross check this self-assessment with other information.
(c) The sum of all component items for each measure may not equal 100% due to rounding and/or provision of multiple responses, refer to Explanatory Note 17.
(d) Includes attendance at external training, workshops and seminars.
(e) Examples include specific community enhancement projects, charity contributions or support.

In 2008-09, 39% of businesses reported an increase in income from sale of goods or services compared to the previous year, ranging from 34% for businesses with 0-4 persons employed to 62% for businesses with 200 or more persons employed. Over a third of businesses (36%) reported a decrease in profitability since 2007-08.

At industry level, businesses in Financial and insurance services were most likely to have reported a decrease in profitability, at 50%. In contrast, 17% of businesses within Health care and social assistance reported a decrease in profitability.

Over a third of innovation-active businesses (34%) increased their productivity since last year, compared with 16% of non innovation-active businesses.