Conceptual Framework of Performance (common period for assessments but is not only the

period for assessments)

Management
Performance Management – a continuous process of
identifying, measuring, and developing performance in 6 Components of Performance Management
organizations by linking everyone’s performance and
1. Performance Planning – jointly down by the
objectives to the organization’s overall mission and goals
appraiser and reviewee in the beginning of the
• Continuous process – ongoing; never-ending performance session
process of setting goals and objectives, Employees are include in discussion because the
observing performance and giving and receiving employees are the persons being reviewed and
ongoing coaching and data it would be unreasonable and unfair on their part
• linking everyone’s performance and objectives if they did not know how they are being
to the organization’s overall mission and goals – assessed.
managers need to ensure that the employee’s 2. Performance Appraisal and Reviewing –
activities and output are in line or congruent performed twice a week in the form of mid and
with the organization’s goals that will help the annual reviews at the end of financial year
gain a competitive business advantage, direct 3. Feedback – the employee acquires awareness
link between the employee performance and from the appraiser about the areas of
organizational goals improvements and information if the employee
is contributing to the expected levels or not.
Is the performance management the same with Employee receives an open and transparent
performance appraisal? NO feedback
As to As to As to As to 4. Rewards – vital component as it will determine
PROCESS FREQUENC FOCUS OWNERSHI the work motivations of the employee.
Y P
Performanc Top-down Periodic Quantitativ Owned by Employee is publicly recognize for good
e Appraisal assessme meeting e the HR performance and is rewarded
nt objectives Departmen
t
5. Performance Improvements Plans – fresh set of
Performanc Joint Continuou Quantitativ Owned by goals are established by the employee and new
e process s review e and the line deadline is provided for accomplishing for those
Manageme through qualitative managers
nt dialogue objectives objectives
Performance Management - Process of identifying, 6. Potential Appraisal – the potentials of the
measuring, managing, and developing the performance employees are appraised so that they will be
of the human resources in an organization. How well the assigned tasks that they will fit.
employees perform; systematic analysis in measurement
of worker’s performance and its communication of the
individual to improve their performance a. Performance – improving all the factors that will
increase the profit, reduced expenditures,
A comprehensive, continuous, and flexible approach to increase income that will result in more output
the management of organizations, teams, and per unit input; maximizing the amount of output
individuals which involves the maximum amount of energy from a system
dialogue between those concern. b. Productivity – examines the relationship
Performance Appraisal - Ongoing process of evaluating between output and input; does not merely
employee performance and are reviews of employee define the volume of the output rather, the
performance over a certain period. A one piece of output obtained in relation to the resources
performance management. employed. The highest productivity for each
level of input is the efficient situation.
A more limited approach which involves managers, c. Efficiency – main components: technical and
making pop down assessments and rating the allocative
performance of their subordinates which is done usually
 1. Technical efficiency – maximum output of partners which can be suppliers, intermediaries, third
set of inputs party services providers, and customers.
2. Allocative efficiency – optimal combination
Procurement + Manufacturing + Warehousing +
of inputs
Transportation
The company can be technically efficient but allocatively
It integrates supply and demand management within and
inefficient if the firm fails to choose the optimal
across companies
combination of inputs at a given level of prices. Must be
combined to achieve overall efficiency.

Financial Performance Analysis - A process of identifying

the financial strengths and weaknesses of the firm by
properly establishing the relationship between the items
in balance sheets and income statement or profit or loss
account

What is the financial position of the firm at a given point

in time?

This can be answered with the help of the financial

analysis of a firm which involves the use of financial

statements. It may show us a position at the moment of The supply chain which is also referred to as the logistic
time as a in the case of balance sheets of an income network consist of:
statement.
1. Suppliers
2. Manufacturing centers
Financial Performance Analysis Process 3. Warehouses
4. Distribution centers
1. Selection – select the information relevant to the 5. Retail outlets
decision under the consideration from the total
information contained in financial statements
2. Relation - highlight significant relationships that Supply Chain Management – is a set of approaches
is why to relate it to the items of financial utilized to efficiently integrate suppliers, manufacturers,
statements warehouses and stores, so that merchandise is produced
3. Evaluation – interpretation and drawing of and distributed at the right quantities, to the right
inferences and conclusions locations, and at the right time, in order to minimize
Significance of the Performance Analysis to the Study of system-wide costs while satisfying service level
Performance Management System requirements.

The financial statement analysis is important in the study Objectives:

of performance because it gives us a picture f the 1. It must take into consideration every facility that
company’s performance particularly on the aspect of has an impact on cost and plays a role in making
financial performance. Several stakeholders analyzed the the product conform to customer requirements
financial performance of the firm, but the type of analysis 2. It must be efficient and cost-effective across the
varies according to their specific interests entire system
Supply Chain Management 3. It must revolve around efficient integration of
suppliers, manufacturers, warehouses and
Encompasses the planning and management of all sores; it encompasses the firm’s activities at
activities involved insourcing, procurement, conversion many levels, from the strategic level through the
and logistics management services or activities. It also tactical to the operational level.
includes coordination and collaboration with channel
Components: 6. Decrease customer management costs

1. Plan – strategic potion of supply chain CRM is an integrated approach to identifying, hiring, and
management. A strategy is needed to manage all retaining customers by enabling organizations to manage
the resources that go to meeting of the customer and coordinate customer interactions across multiple
demand for product and services. channels, departments line of business under
2. Source – choose suppliers that will deliver the geographies. CRM helps organizations maximize the
goods and services needed to create the value of every customer interaction and drive superior
product. Develop a set of pricing, delivery, and corporate performance.
payment processes with suppliers, and create
metric for monitoring and improving
relationships.
3. Make – the manufacturing step. Schedule the
activities necessary for production, testing,
packaging, and preparation for delivery.
4. Deliver – many insiders refer to as logistics.
Coordinate the receipt of order from customers,
develop a network of warehouses, pick carriers
to get products to customers, and set up
invoicing system to receive payments
5. Return – problem part of the supply chain.
3 Parts of CRM Application Architecture
Create a network for receiving defective and
excess product back from customers and 1. Analytical CRM – customer data analysis, its
supporting customers who have problems with evaluation, modeling and prediction of customer
delivered products. behavior. In real life, Analytical CRM gather all
the data about customers inquiring a specific
product by using data mining, what service they
Customer Relationship Management purchase right away, and what services they
purchase eventually. It can find patterns in their
It entails initiatives that surround customer side of the behavior and propose next steps during upselling
business. An example is initiatives wrapped around or cross- selling. It can evaluate efficiency of a
customers in an effort to increase sales, improve marketing campaign, propose prices, or even
customer service, add market share, enhance customer develop and propose new products. This way,
loyalty, and reduce operating costs of sales and service. Analytical CRM serves as some sort of help
CRM a business strategy comprised of process, during decision making. Examples, manuals for
organizational and technical change whereby a company employees working with services concerned how
seeks to better manage its enterprise around its to interact or react to certain customer behavior.
customer behaviors. 2. Operative CRM – actual contact with customers
conducted by front office workers and general
It entails acquiring and deploying knowledge about automation of business processes including sales
customers and using this information across the various of products, services, and marketing. All
customers touch points to increase revenue and achieve communication with a customer is trapped and
cost reduction through operational efficiencies. stored in the databased and if necessary it is
1. Understand the customer effectively provided to users (employees or
2. Retain customers through better customer workers). The advantage of this approach being
experience the possibility to communicate with various
3. Attract new customers employees using various channels but creating
4. Win new clients and contracts the feeling that customer is taken by one person.
5. Increase profitability It can also minimize the time that the worker has
to spend typing the information and
 administrating or when the data is shared. This
allows the company to increase the efficiency of
their employees works and they are also able to
serve more customers.
3. Collaborative CRM – all companies along the
distribution channel as well as all the
departments in a company to work together and
share information about customers. This also
speaks about partner relationship management.
The goal of it is maximum sharing of relevant
information acquired by all departments with a
focus on increasing the quality of service
provided by customers. The ultimate outcome
should be an increase in customers utility and
loyalty.

Customer Profitability Analysis

It attempts to bring together marketing and accounting We might say that Customer B is the most valuable
professionals to analyze, manage, and improve customer customer because we were able to earn Php240,000
profitability. Companies are attempting to understand from Customer B. However, after doing customer
better customer demand however, the goal is to increase profitability analysis using ABC, it was Customer A who
customer satisfaction profitability. It recognize that each are most profitable as the profit percentage is 66% way
customer is different and that each peso of revenue does higher than Customer B. Customer C and B yielded a very
not contribute equally to the firm’s profitability. low profit percentage and it is better to turn them into
Customers utilize company resources differently, thus profitable customers if possible. Example introducing a
customer costs vary from one costs to another. third-party wholesaler into the supply chain which might
result in the improvement of the product range and
Issues:
service to the small customers who were not so
1. How to develop reliable customer revenue and profitable to the firm.
customer cost information
2. How to recognize future downstream costs of
customers
3. How to incorporate a multi-period horizon in the
analysis
4. How to recognize different drivers of customer
costs

Activity-Based Costing (ABC)

It uses activities as cost drivers. To compute for the total

cost, multiply the cost per activity to the volume of the
activity. To compute for the percentage, divide the
operating profit by revenues.