Is Revenue per employee a useful performance measure?
As you know I strongly believe that you must in a business measure what matters to your customers, so is Revenue per employee a useful measure? It is an internal measure in that it is not directly measuring something that is important to the customer. In managing a business it is always necessary to have some internal measures to ensure that the business is efficiently delivering the service to the customer.
The revenue obtained represents the customers perception of the value of the service being delivered. By dividing this number by the number of people in organisation shows the efficiency in delivering this value.
So in conclusion, the measure is of some use but is only a measure of efficiency, it does not directly measure what is important to the customer.
Related posts:
If you would like more articles like this then please subscribe:
Or, subscribe via email:
Comments
Leave a Reply
-
Subscribe to Major Focus Group
Or, subscribe via email:
-
Subscribe to our FREE newsletter, The Focal Point and get your FREE copy of How to have a Focused Business.
We respect your privacy: No spam mail and you can unsubscribe at any time.