Article: How To Use Small Business Value As The Ultimate Performance Indicator
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How To Use Small Business Value As The Ultimate Performance Indicator
Business performance measurement and management promote the use of carefully selected key performance indicators to evaluate the performance of a company, its management and employees. Management theory has long recognized that the primary purpose of a company?s management is to maximize shareholder value. For large companies with stock that freely trades in public securities markets, this is a simple process of monitoring stock price. For small, private companies the situation is quite different.
Large, public companies have many stockholders that elect a board of directors, who in turn hire the key executives. This separation of ownership from management does not exist in small, private businesses. Often these three groups (owners, directors and management) are comprised o...
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