By James Bell
Overall Equipment Effectiveness (OEE) is a utilization metric that looks at how productive manufacturing is during it’s scheduled operation. We look at quality, availability and performance as the 3 parts or categories of this metric. This is a great metric for gaining insights on improving manufacturing processes,. We can create benchmarks and determine the drivers
By James Bell
Contribution margin in it’s simplest form is total sales minus total variable costs but it can also be expressed as a ratio. This margin is what is left over to pay fixed costs and for capital. This is different than Gross Margin in that GM uses COGS instead of variable costs. COGS does not equal
By James Bell
The Treynor Ratio is a reward to volatility metric. It is named after the economist Jack Treynor. It’s a performance measure that determines the additional return generated for each unit of systemic risk in a portfolio. Treynor Ratio where Portfolio Return Risk-Free Rate Beta of the Portfolio Portfolio Return This is
By James Bell
The Sharpe ratio is a risk vs return metric. The economist William F. Sharpe built this formula in 1966. He would later receive a Nobel Prize for his work on CAPM. The higher the number the better here for this ratio. Remember to keep the periods consistent when making comparisons. A typical period is monthly
By James Bell
The Zeta Model helps us determine if a public company will declare bankruptcy in the next 2 years. It was first published in 1968 by NYU Finance Professor Edward L. Altman. This model assigns a score based on various weighted metrics. These metrics combine balance sheet and income statement items to look at the
By James Bell
Earned value (EV) is simple formula that measures the progress of the project as a dollar value. It shows us the value of the project to date and is part of the Earned Value Management Methodology. EVM is an objective and systematic way for measuring performance and progress of projects. As a business manager articles
By James Bell
Schedule Variance is an Earned Value Management metric that tells us if a project is behind, on, or ahead of schedule. We will go over the traditional way of calculating it and then an alternate way of calculating this metric. The result of this formula is a dollar amount. This is confusing because we are
By James Bell
Planned Value (PV) is a component of Earned Value Management. EVM is an objective and systematic project management methodology for measuring performance and progress of projects. Planned Value is one of the metrics within this methodology. Another name is the Budgeted Cost of Work Scheduled (BCWS). PV is the value of completed work thus far.
By James Bell
Cost Variance (CV) helps us understand if we are over, under, or on budget for projects. We use this along with the schedule variance to get an idea of how the project is going. Making good estimations and forecasts about a project is a good way to make sure that Cost Variance does not get
By James Bell
Committed Monthly Recurring Revenue is a metric that we use in forecasting recurring revenue in future periods. You may also hear CMRR called Contracted Monthly Recurring Revenue. CMRR gives you an idea of future inflows and outflows of Monthly Recurring Revenue which is important when managing a subscription based business model. We build upon the
15 March 2020
15 December 2019
14 November 2019
07 November 2019
12 October 2019
26 September 2019
11 September 2019
Powered By Impressive Business WordPress Theme