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Identify and explain two key performance indicators that Turbo Motors could use to determine the success of their outsourcing policy. - VCE - SSCE Business Management - Question 2 - 2004 - Paper 1
Question 2
Identify and explain two key performance indicators that Turbo Motors could use to determine the success of their outsourcing policy.
Worked Solution & Example Answer:Identify and explain two key performance indicators that Turbo Motors could use to determine the success of their outsourcing policy. - VCE - SSCE Business Management - Question 2 - 2004 - Paper 1
Step 1
Key Performance Indicator 1: Financial Performance
Answer
One crucial performance indicator for Turbo Motors would be financial performance. This includes metrics such as cost savings achieved through outsourcing, profit margins, and overall revenue growth attributed to outsourced operations. By regularly analyzing these financial metrics, Turbo Motors can assess the economic benefits of their outsourcing policy and make informed decisions about future contracts.
Step 2
Key Performance Indicator 2: On-Time Completion Rates
Answer
Another key performance indicator is the on-time completion rates of outsourced projects. This measures the efficiency and reliability of third-party providers in meeting deadlines. A high on-time completion rate indicates successful outsourcing, contributing positively to the company's productivity and customer satisfaction. Monitoring this indicator helps ensure that external partners align with Turbo Motors' operational objectives.