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In many cases when measuring organizational performance, companies tend to focus solely on the financial perspective, setting objectives such as “Achieve profit growth” (measuring it through $ Gross profit margin, $ Net cash flow, or similar indicators) or “Maintain financial discipline” (measuring it through % Budget variance, # Berry ratio, or others).
Placed at number #41 in the Forbes ranking of The World’s Most Valuable Brands, there is no doubt that Zara came a long way from when it was founded in 1974, becoming one of the world’s best known fashion brands and the flagship brand of the £2.5 billion holding group Inditex.
Sustainability reporting has been increasing in scope over the past years, given that the number of organizations worldwide issuing sustainability reports has been growing yearly, driven by several major trends, reflecting shifts in the regulatory, community, investor and consumer landscapes.
Organizations should be aware that old methods and strategies may not apply in a fast changing environment, in which an increasing number of companies are more innovative in their businesses.
Performance management, at least at the employee level, has received serious criticism from multinationals such as Microsoft, General Electric, Adobe, Goldman Sachs Group and Google, in the past 5 years. The traditional ranking system and KPI measurement used in the appraisal process provided little added value for the organization, for managers or for the individual. Practice has proved that a measurement system is merely a promise of improvement.
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