In the dark II
What many boards and executives still don’t know about the health of their businesses
Business leaders have long understood that what you measure is what you get. Money drives markets, so the financial measurements that drive company valuations produce the precise sort of return-focused behavior expected by most investors.
Few would deny this, but are metrics such as cash flow, sales or earnings the true determinants of corporate performance or a means of scoring the success of less financially focused business activities and strategies? It is from this perspective that business executives, always in search of a competitive edge, are asking increasingly sophisticated questions about performance measurement.
In 2004, Deloitte Touche Tohmatsu (DTT), in cooperation with the Economist Intelligence Unit, examined key non-financial metrics in a report titled “In the Dark: What boards and executives don’t know about the health of their businesses.” The report concluded: “While the overwhelming majority of board members and senior executives say they need incisive non-financial information on their companies’ key drivers of success, they largely find such data to be lacking or, when available, of mediocre to poor value.”
Almost three years later, Deloitte and the Economist Intelligence Unit worked together to see whether things had changed. This 2007 survey finds many board members and senior executives are still in the dark about the overall health of their organizations and have a lack of high-quality non-financial data that they can act upon.
Learn more from the full report, available below in PDF format:
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