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Relationships between Innovation Capabilities, Business Performance, Marketing Performance and Financial Performance: Revenues & Market Share

Relationships between Innovation Capabilities, Business Performance, Marketing Performance and Financial Performance: Revenues & Market ShareMarketing Performance -relationship with Sales Growth, Cost Reduction, Revenues & Market Share

According to the prior study’s result, innovation capability is positively related to market performance. Market innovation is the most significant factor for market performance (AMA 2005). Market performance will be affected by the customer behaviors, which can be measured using unit sales and sales revenue. Thus, the financial performance outcome in terms of revenue, cash flow, and profitability can be determined by the sales performance of the firm. (Day and Fahey, 1988; Kaplan and Norton, 1993). The US American Marketing Association White Paper (AMA 2005) identified Incremental sales revenue, Ratio of cost to revenue, Cost per sale generated, Changes of financial values of sales generated, Cost of new customer and Cost of old customer retention as the ROI measurement (AMA 2005).

Recently, a methodology for projecting a firm’s ROI in service quality has been introduced by the “return on quality” model (Rust et al., 1995). Research has shown the possibility of trade-offs between service quality improvement that increase revenue and reduce costs (Anderson, Fornell, and Rust 1997). The financial risk also need to be considered in the approaches to evaluate the financial return (Davis 2002), as is common in corporate finance.
Business Performance -relationship with Sales Growth, Cost Reduction, Revenues, Market Share & Customer Retention

There were 9 articles shows strong relationship on business performances.

This post was written by , posted on November 13, 2013 Wednesday at 1:13 pm