Ekonomika a management
BENEFITS OF KPIS FOR INDUSTRY SECTOR EVALUATION: THE CASE STUDY FROM THE CZECH REPUBLIC
Industrialization, a major force in structural change, shifts resources from labour-intensive activities to more capital technology-intensive activities. It will remain crucial to the future growth of developing countries. Manufacturing’s share of GDP has remained stable over the last 40 years. Technology and capital equipment are the main drivers of both manufacturing growth and aggregate growth in developed and developing countries, although in developing countries energy and natural resources use affects growth in the medium- and low-tech industries (Unido, 2018). Currently, the industrial value creation is shaped by the development towards the fourth stage of industrialization, so-called Industry 4.0. Industry 4.0, referred to as the “Fourth Industrial Revolution”, also known as “smart manufacturing”, “industrial internet” or “integrated industry”, is currently a muchdiscussed topic.
Jméno a příjmení autora:
Martina Hedvičáková, Martin Král
Industry, added value, EBIT, key performance indicators, GDP, correlation analysis
DOI (& full text):
Currently, there is a fourth Industrial Revolution known as Industry 4.0. This industrialization is characterized by structural changes in the substitution of labour by new technologies and capital.…více
Currently, there is a fourth Industrial Revolution known as Industry 4.0. This industrialization is characterized by structural changes in the substitution of labour by new technologies and capital. The paper focuses on the industrial sector, which is dominant in the Czech Republic and has a significant contribution to GDP and value added. It describes the current economic situation in Czech Republic and in European Union. Many companies use absolute indicators (such as sales, profits, ...) or financial indicators (such as asset turnover, return on assets, ...) to evaluate their performance and efficiency. A Performance Indicator or Key Performance Indicator (KPI) is a term used by industry or professionals for assessing or type of performance measurement. The aim of the paper is to critically assess the performance evaluation of individual industries based on the absolute monitored indicators compared to the key performance indicators (KPIs). The paper contains a proposal for a KPIs system that would allow performance assessments of industry sectors, including a correlation analysis of these indicators, to allow for long-term relations. Therefore, it is possible to evaluate the performance of individual industry sectors by means of their aid. At the same time, KPI provides sufficient information on whether to invest more in individual industrial sectors and replace human work by modern technologies or, on the contrary, whether these investments bring no added value and that it is therefore appropriate to stop them and leave this sector to other (more competitive) countries. KPI indicators gain in importance in Industry 4.0. Primary and secondary sources were used in the processing of the article.
Ekonomika a management