Business Performance Assignment Sample

Operational Performance1
Operational Performance
Student’s Name
Professor’s Name
Course Name
Date
CASE STUDY - FITWORX LEISURE CENTRE Version 1 (June 2014) Page 1 of 2
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Operational Performance2
TASK 1 – MONITORING OPERATIONAL PERFORMANCE
The relevant approach when controlling and monitoring the costs incurred and expenditure
is determined by the structure, management style, size and nature of the organization. In this case
study, we have Fitworx which has different tabulations of the income statement divided into
annual sections, maintenance, expenditure, total base salary costs, swim school customer volumes
and swim school fees under the budget data section. The organization’s performance reports
indicate slight but progressive changes over the two compared fiscal years. To grasp the annual
financial implications within the performance reports, one has to compare the different annual
financial indications offered in the data collected (Berger, 2011). For instance, it is observable that
the revenue generated in Swim School Financial Data for the year ended in 30 June 2014 was
$306,405 compared to an increase in the following year of $366,862. Generally, the most
appropriate review of the operational performance would entail looking at the profit generated
over the two financial years which in this case was $2,126 and $21,179 in both 2014 and 2015
respectively. Therefore, it is notable that there was an increase in the net profit generated since
after deducting the total expenditure from the revenue generated then the above stipulated values
are generated (Berger, 2011).
Secondly, using the four steps of monitoring the organization’s performance reports an
appropriate comparison can be effectively analyzed. The initial step entails establishing where the
monitoring is needed and in this scenario the important sections of the operational plan should be
noted such as cutting costs, improving quality, increasing sales, employee productivity, and
customer satisfaction. Basing from the total annual staff costs increase from $210,000 to $262,500
it is appropriate to reduce this cost by deducting the salary of part time Instructor number 2 or
reducing the salary of the senior instructor thereby curbing overspending as observed from the
reduced number of 2014-15 (actual) customers compared to 2015-16 (budgeted) customers at 1959
and 1950 respectively. Furthermore, sales can be increased by reducing the cost swim school fees
CASE STUDY - FITWORX LEISURE CENTRE Version 1 (June 2014) Page 1 of 2
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Operational Performance3
to attract more customers as observed with the general increase observed in both the nursery,
toddler, preschool and school age fees as indicated in the performance report. Generally, customer
volumes have slightly reduced as indicated in the 2015-16 (budgeted) at 1950 from 1959 the
previous fiscal year. Suppose the operation plan went wrong then the actual values of the financial
results generated would not be accurate and this would lead to poor organizational monitoring.
Therefore, the organization could realize losses generated from poor financial management plans
which could lead to closure of the business entity. The organization’s mission and vision are
supported with the above assertions since the whole analysis is focused in ensuring the entity is
capable of generating income and increasing the number of consumers whilst reducing the repair
and maintenance, salary and administrative costs.
The second step entails establishing the measures that should be monitored which need to
be focused on the total salary costs, customer volumes, administrative, repair and maintenance,
swim school fees, and the performance reports. The objectives of the operational plan will be met
once the total salary costs are analyzed and the increased payments over the years should be
marginalized to cater to the extra administrative, repair and maintenance costs. Notably, an
increase in customer volumes would guarantee that the administrative, repair and maintenance
costs would also increase thereby the total administrative costs which had reduced to $12,669 from
$21,520 in 2015-16 and 2014-15 respectively would need to be increased. Therefore, basing from
the data collected it is correct to ascertain that there had been a slight decrease in customer
volumes in the final year and this can be attributed to decreased maintenance, repair and
administrative costs. Furthermore, this could also be attributed to increased swim school fees
which could lead to a reduction in the number of subscribed consumers who prefer reduced swim
school fees as indicated in the previous year comparisons. Some of the lead indicators such as the
quality standards, performance standards, KPIs and goals can be measured over the three years to
generate a corrective measure. The goals of the entity are to generate profit and this can be
CASE STUDY - FITWORX LEISURE CENTRE Version 1 (June 2014) Page 1 of 2
Disclaimer: Printed copies of this document are regarded as uncontrolled. Please check http://sitwww.tafensw.edu.au
to ensure this is the latest
version.