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 2012.

Business performance assessment, by extent of focus, by type of measure(a)(b)(c), 2011-12
		Not at all	A small extent	A moderate extent	A major extent
		%	%	%	%
Type of measure
	Financial (e.g. profits, sales growth, returns on investments)	15.9	20.3	31.0	32.8
	Cost (e.g. budget, cost per unit of output, inventory cost)	18.9	21.0	32.0	28.0
	Operational (e.g. asset utilisation, on-time delivery)	27.4	22.6	29.6	20.6
	Quality (e.g. customer satisfaction, defect rates)	16.4	14.3	29.4	39.9
	Innovation (e.g. new process innovation, new value added products)	31.9	26.9	26.7	14.7
	Human resources (e.g. job satisfaction, skills development)	31.7	26.2	29.9	12.2
	Environmental (e.g. recycling program, adherence to environmental regulations, sustainability considerations, carbon footprint analysis)	37.9	30.9	21.9	9.3
(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 may not equal 100% due to rounding and/or provision of multiple responses; refer to Explanatory Note 29 and the Quality Declaration.

Consistent with previous results, during 2011-12, two in five Australian businesses reported that they focussed on quality measures of business performance to a major extent and a third of all businesses focussed on financial measures to a major extent. Conversely, almost two in five businesses reported that they had no focus at all on environmental performance measures (38%).

Businesses in Electricity, gas, water and waste services were the most likely to focus on environmental measures to a major extent (37%) followed by Mining (23%).

Innovation-active businesses were more likely to focus on quality measures to a major extent (52%) than non innovation-active businesses (29%). Non innovation-active businesses were almost three times as likely to report no focus at all on human resources measures (45%) than innovation-active businesses (17%).

Further data relating to business performance assessment can be accessed via the Downloads tab.


CHANGES IN BUSINESS PERFORMANCE AND ACTIVITIES

Businesses were provided with a list of performance indicators and activities and were asked to assess whether 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 and activity.

Changes in business performance and activities(a)(b)(c), compared to previous year, 2011-12
		Decreased	Stayed the same	Increased	Not applicable
		%	%	%	%
Performance indicators and activities
	Income from sales of goods or services	34.1	18.7	36.1	11.2
	Range of products or services offered	6.4	60.8	17.1	15.9
	Profitability	36.6	24.7	28.4	10.4
	Productivity	17.0	42.5	23.6	17.0
	Total number of jobs or positions	14.8	56.2	14.6	14.5
	Export markets targeted	1.1	8.3	1.4	89.2
	Contracting out work/activities or outsourcing	5.5	21.5	7.1	65.9
	Structured/formal training for employees(d)	4.2	37.7	10.5	47.7
	Expenditure on Information Technology (IT)	5.9	38.8	17.9	37.4
	Social contributions(e)	4.9	36.2	8.9	50.1
(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 for each measure may not equal 100% due to rounding and/or provision of multiple responses. Refer to Explanatory Note 29 and the Quality Declaration.
(d) Includes attendance at training, workshops and seminars.
(e) Includes specific community enhancement projects, charity contributions or support.

An increase in income from sales of goods or services was reported by 36% of businesses, almost the same proportion of businesses as those that reported a decrease (34%). Over a third of businesses reported a decrease in profitability compared to the previous year (37%).

The proportion of businesses that reported an increase in income from sales of goods or services increased with each employment size range, from 30% of businesses with 0-4 persons employed to 70% of businesses with 200 or more persons employed. Businesses that employed 200 or more persons were the most likely to report a decrease in total number of jobs or positions (22%).

The proportion of businesses that reported an increase in income from sales of goods and services was highest in the Arts and recreation services and Electricity, gas, water and waste services industries (both 42%). Conversely, 47% of businesses in Manufacturing indicated a decrease in income from sales of goods and services. These businesses were also the most likely to report a decrease in profitability (49%). At least a quarter of businesses in the remaining selected industries also reported a decrease in profitability.

For each of the performance indicators provided, innovation-active businesses were more likely to report that there had been an increase in the indicator or activity from the previous year than non innovation-active businesses. For example, innovation-active businesses were more than twice as likely to report an increase in productivity (34%) and the total number of jobs or positions (21%) than non innovation-active businesses (14% and 8% respectively).

Innovation-active businesses were more than four times as likely to report that structured/formal training for employees increased than non innovation-active businesses (18% compared with 4%) and were more likely to report an increase in profitability than non innovation-active businesses (34% compared with 24%).

Further data relating to change in business performance can be accessed via the Downloads tab.