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8167.0 - Selected Characteristics of Australian Business, 2007-08 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 17/09/2009   
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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 2008.

Business performance assessment, by extent of focus(a)(b)(c), by type of measure, 2007 - 08

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)
17.9
19.7
29.0
33.5
Cost (e.g. budget, cost per unit of output, inventory cost)
21.3
22.1
31.0
25.7
Operational (e.g. asset utilisation, on-time delivery)
30.3
22.5
26.8
20.6
Quality (e.g. customer satisfaction, defect rates)
17.5
15.9
28.2
38.8
Innovation (e.g. process innovations, new value added products)
32.6
29.7
25.7
12.3
Human resources (e.g. job satisfaction, skills development)
29.6
26.5
30.3
13.6
Environment (e.g. recycling programs, sustainability considerations, carbon footprint analysis)
36.4
31.1
22.4
10.2

(a) Proportions are of all businesses.
(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 Note 17.


When assessing business performance, 34% of businesses reported focussing on financial measures to a major extent, while 18% of businesses reported not focussing on this measure at all. Across the four employment size ranges, businesses with 0-4 persons employed were most likely to have not focused on financial measures and cost measures.

The most commonly reported measure focussed on to a major extent was quality (39%). Almost 60% of businesses with 200 or more persons employed reported focussing on quality measures to a major extent when assessing the performance of the business.

At the industry level, both Manufacturing and Accommodation and food services reported the highest proportion of businesses focussing on quality measures to a major extent (43%). Half of the businesses within Financial and insurance services reported not focussing on environmental measures at all. By contrast, 41% of businesses within Electricity, gas, water and waste services reported focussing on environmental measures to a major extent when assessing their business performance.

Innovation-active businesses were twice as likely to focus on financial measures to a major extent than non-innovation active businesses when assessing the performance of the business.


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.

Changes in business performance and activities(a)(b)(c), compared to previous year, 2007 - 08

Decreased
Stayed the same
Increased
Not applicable
%
%
%
%

Performance measures and activities
Income from sales of goods or services
28.0
18.8
43.9
9.5
Profitability
30.8
26.8
31.4
11.1
Productivity
13.0
40.4
27.4
19.4
Range of products or services offered
5.1
56.6
21.1
17.2
Export markets targeted
0.4
4.5
2.3
92.8
Contracting out work/activities or outsourcing
4.4
17.7
8.2
69.6
Amount of structured/formal training for employees(d)
2.4
35.2
12.6
49.8
Expenditure on Information Technology (IT)
3.9
34.1
20.8
41.3
Social contributions(e)
3.1
36.1
10.4
50.5

(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 component items for each type of performance measure or activity 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.


Overall, 44% of businesses reported an increase in income from sales of goods or services since last year, ranging from 37% for businesses with 0-4 persons employed to 77% with 200 or more persons employed. In comparison, 28% of businesses reported income from sales of goods or services decreased since last year. This proportion decreased with each successive employment size range, from 30% for businesses with 0-4 persons to 17% for businesses with 200 or more persons employed.

At the industry level, businesses within Information media and telecommunications were the most likely to report an increase in profitability (40%) and productivity (37%).

Over half of innovation-active businesses increased their income from sales goods or services since last year, compared to 38% of non innovation-active businesses.


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