BUSML 4380 Lecture Notes - Lecture 4: Apics, Income Statement
10 Nov 2018
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Metric: relative measurement with 2+ measures, percentage, comparisons in time. Preferred b/c of ability to analyze, compare, report. Relevant to the business performance that you are determining. Concise, minimized effort, avoid conflict, consistent for comparisons over time. Too focused on the metrics, can"t relate it back to the big picture. Measurements aren"t standardizes among companies and industries, so hard to compare each other and create relativity. Fail to communicate some down-to-earth metrics to senior management. Solution has been scor by the apics council. Top execs only care about financials because of the impact to stockholders. Revenue - measuring how good product is reaching customer. Cost of goods sold - measuring inventory costs, transport, damage associated directly with product. Operating costs - other costs that are significant to storing, processing, moving product. Interest - financing costs with assets, inventory, transport if applicable. Inventory - each stage of the inventory from raw materials to finished.
