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 focussed on these measures when assessing overall business performance during the year ended 30 June 2011.

Business performance assessment, by extent of focus, by type of measure(a)(b)(c), 2010 - 11
		Not at all	A small extent	A moderate extent	A major extent
		%	%	%	%
Type of measure
	Financial (e.g. profits, sales growth, returns on investments)	18.5	18.2	30.4	33.0
	Cost (e.g. budget, cost per unit of output, inventory cost)	19.7	21.4	31.9	27.3
	Operational (e.g. asset utilisation, on-time delivery)	28.3	22.8	28.7	20.4
	Quality (e.g. customer satisfaction, defect rates)	18.3	15.2	28.2	38.5
	Innovation (e.g. new process innovation, new value added products)	33.0	27.6	27.3	12.4
	Human resources (e.g. job satisfaction, skills development)	31.1	26.6	30.7	11.8
	Environmental (e.g. recycling program, adherence to environmental regulations, sustainability considerations, carbon footprint analysis)	39.2	29.0	23.7	8.2
(a) Proportions are of all businesses in each output category.
(b) Businesses were asked to indicate to what extent the business focussed 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 Notes 29 and 30 and the Quality Declaration.

When assessing business performance, the measure most focussed on to a major extent was quality (38%), followed by financial (33%). The measure least focussed on was environmental (39%).

Businesses in Manufacturing (43%) were the most likely to focus on quality to a major extent, followed by Accommodation and food services, Health care and social services and Other services (all 42%). Businesses in Electricity, gas, water and waste services were the most likely to focus on environmental measures to a major extent (40%) followed by Mining (23%).

Non innovation-active businesses were almost twice as likely to report no focus at all on environmental measures (48%) than innovation-active businesses (26%). Innovation-active businesses were more likely to focus on financial measures to a major extent (45%) than non innovation-active businesses (25%).


CHANGES IN BUSINESS PERFORMANCE AND ACTIVITIES

Businesses were provided with a list of performance indicators and activities 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 response for each performance indicator of activity.

Changes in business performance and activities(a)(b)(c), compared to previous year, 2010 - 11
		Decreased	Stayed the same	Increased	Not applicable
		%	%	%	%
Performance indicators and activities
	Income from sales of goods or services	32.3	18.8	40.4	8.6
	Range of products or services offered	6.0	61.3	17.7	15.0
	Profitability	35.3	26.5	29.2	9.1
	Productivity	15.9	43.5	24.9	16.0
	Total number of jobs or positions	14.1	57.5	15.7	12.8
	Export markets targeted	1.3	9.5	1.6	87.6
	Contracting out work/activities or outsourcing	4.8	21.3	8.1	65.9
	Amount of structured/formal training for employees(d)	3.7	38.4	10.1	47.9
	Expenditure on Information Technology (IT)	5.9	38.9	18.1	37.2
	Social contributions(e)	5.1	36.7	10.0	48.2
(a) Proportions are of all businesses in each output category.
(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 the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses. Refer to Explanatory Notes 29 and 30 and the Quality Declaration.
(d) Includes attendance at training, workshops and seminars.
(e) Examples include specific community enhancement projects, charity contributions or support.

An increase in income from sales of goods or services was reported by 40% of businesses. Over a third of businesses (35%) reported a decrease in profitability compared to the previous year. The range of products or services offered stayed the same for 61% of businesses.

The incidence of businesses reporting an increase in income from sales of goods or services increased with each employment size range from 36% for businesses with 0-4 persons employed, to 68% for businesses with 200 or more persons employed. Businesses with 20-199 persons employed were the most likely to report a decrease in profitability (37%).

More than half of businesses in Electricity, gas, water and waste services reported an increase in income from sales of goods and services (52%). Conversely, 46% of businesses in Retail trade indicated a decrease in income from sales of goods and services. Businesses in Retail trade were also the most likely to report a decrease in profitability (46%). Businesses in Mining were the most likely to report an increase in total number of jobs or positions (30%).


Over one third of innovation-active businesses (35%) reported increased productivity compared to the previous year, almost twice the proportion reported by non innovation-active businesses (18%).

Innovation-active businesses were four times more likely to have increased their range of products or services offered by the business than non innovation-active businesses (32% and 8% respectively).