CRM 11- Performance measurement

Important stakeholders of a company

- Shareholders / Board of directors - Customers - Employees/Management

An organisation must maximize the main sources of revenue, profit and growth within the context of both business and customer strategy. The three key stakeholders group are:

Employee Value
Employee value needs to be considered from two perspectives.

#1 the value employees deliver to the organization - This is usually measured against a number of performance objectives, where employees are appraised against performance targets

#2 the value the organisation delivers to the employees - Comprises the benefits the work force receives in exchange for the opportunity cost, time and labour expended in performing their job.

Customers Value
The value the customer receives from the organisation is defined by the perceived benefits of the offer made to the customers, which extend beyond the core product or service. These higher level benefits can come from intangible factors, such as the provision of better customer service or association with a quality brand image.

The value of the organisation receives from the customer is determined by the profits obtained from the customer over the lifetime of their relationship with the organisation.

Shareholder Value
Shareholder value is created by achieving a favourable rate of the return on capital invested. The board of director may expect the following from the company: - Increasing the return generated on existing capital invested - Increasing more capital where the rate of return exceeds that required - Divesting asset which generate a return lower than the required, thus releasing capital for more productive use. - Extending the period over which returns above the required rate are generated - Reducing the cost of