Search results

Although there are many efforts within organisations to improve the financial performance of business processes, the results of studies on the impact of internal factors on the financial performance of business processes in an organisation are inconsistent, even contradictory. Therefore, this paper aims to examine the extent and trends of the impact of factors inside companies on the financial performance of business processes and discover lessons learned to improve the financial performance of business processes.

This analysis was done through a quantitative study of listed companies in Vietnam. Pooled OLS regression, REM, FEM and robust regression were performed on 566 companies.

The results provide four main findings. First, firm size and operational efficiency strongly correlate with financial performance. Second, financial leverage has a negative, significant connection with financial performance. Third, net working capital has a positive and meaningful relationship with EPS and a negative association with ROE. Fourth, liquidity does not have any significant association with financial performance.

This study only restricts the internal factors affecting the financial performance of business processes without mentioning the external factors. Furthermore, this study is limited to one emerging country and has not been compared with companies in different countries.

The findings of this study may help inform users inside and outside the organisation to understand the factors that affect the financial performance of business processes. As a result, information users will focus more on aspects that can improve their financial performance to make informed decisions.

This study has many differences compared to previous studies. First, it focuses on the internal factors affecting the financial performance of business processes in non-financial listed companies in Vietnam, which has an emerging economy. First, it focuses on the internal factors affecting the financial performance of business processes in non-financial listed companies in Vietnam, which has an emerging economy. Second, this study analyses data in companies' financial statements for the ten years from 2012 to 2021, when the Vietnamese economy, in particular, and the world economy experienced many fluctuations due to the impact of the post-financial crisis 2007–2008 and the COVID-19 pandemic. Third, this study provides empirical evidence to support RBV, RDT theories and the trade-off theory of capital structure.

Literature, spanning industrial organization and strategic management disciplines, uses variance decomposition to understand the relative importance of firm, industry and business group effects in shaping profitability variations. Some literature analyzes firm profitability under transition to liberalization. Previous research has taken a static before-and-after view on institutional change. This paper aims to focus on the dynamic process of liberalization in India, analyzing how different institutional regime changes alter firm behavior leading to changes in profitability patterns.

Based on a panel data set of several thousand Indian firms, spanning the 26-year period between 1980-1981 and 2005-2006, the authors determine the relative importance of firm, industry and business group effects in explaining manufacturing firms’ profitability variances across different institutional phases. The authors evaluate three propositions that help assess transition dynamics between phases. They determine the quantum of catch-up or falling behind by firms.

Different industries emerge as profitability leaders, as the economy progresses through different liberalization phases. Business groups that have been more effective in resource appropriation, rent-seeking, politician management and non-market activities in a controlled regime are replaced as profit leaders by those that, in a free-market economy, can be capable of intra-business resource allocation tasks and leveraging corporate capabilities.

The approach demonstrates how to analyze the underlying detailed structure of firm-level data, and performance outcomes, to derive nuanced interpretation of factors giving rise to the effects that explain profitability variances, and how to assess the way these effects behave over time. The dynamic evidence-based approach highlights what factors matter, where, when and why, in influencing profitability variances, which are a key dimension of industrial and economic performance.

The concept of information and communication technology (ICT) has extensively used among travel and hospitality organization in the contemporary world. The present study discovers tourism and hospitality business reactions toward ICT-based marketing usage and investigates its relationship with functional competencies and profitability among tourism and hospitality business organizations in India. With a quantitative approach, the study found an extensive usage of ICT-based marketing in tourism and hospitality organizations was noted from descriptive tables. The application of regression analysis indicated positive and significant impact of ICT-based marketing on functional competencies and profitability of tourism and hospitality organizations in India. A positive and significant correlation was also noted among these two due to adoption of ICT-based marketing. This study provides insights to formulate comprehensive ICT-based marketing strategies to fulfill growing customer needs.

The purpose of this paper is to investigate the importance of business lending as a source of bank profits in the UK banking system. The paper also examines whether the profitability of business lending is mostly driven by heterogeneous characteristics of individual banks or whether it is affected by systematic characteristics such as bank size and ownership structure.

The study uses bank level data from BankScope for a total sample of 83 UK banks and building societies. The period under consideration extends from 2005 to 2009. Econometric estimation is by panel fixed effects.

Our empirical results show that business lending is a statistically significant determinant of bank profits. However, this average effect masks important systematic differences among banks. In particular, we find strong size effects: the profitability of business lending is considerable for small banks but negligible for large banks. In contrast, we could not detect any ownership effects for domestic and foreign banks. These findings persist when the occurrence of the financial crisis is accounted for.

Interestingly, our study relates these findings to the process of financialisation. Yet, the extent of the latter and its impact on various groups of banks (i.e. large, small, domestic and foreign banks) have not been examined. Further research in this area would make an important contribution to the literature.

Our findings suggest that business lending is not a driving factor of profitability for large banks. One possible policy implication – which may be of interest especially to regulators and policy makers – is that capital injections into the larger banks per se are unlikely to lead to an expansion of credit to business.

There is very little research in the literature on the questions addressed in this paper, especially for the UK banking system. Moreover, the process of financialisation, which motivates the enquiry of this paper, is a growing area of research. Thus, the contribution of this paper is twofold.

The purpose of this paper is to focus upon the financial performance of firms that maintain headquarters in the largest cities and firms based in smaller metropolitan areas. Big city locations offer numerous opportunities. On the other hand, maintaining headquarters in big cities is more costly than in less congested locations and the opportunities for distractions tend to be higher. A third alternative is that location does not matter.

The study, the first of its type, applies a multivariate analysis to a large sample of Compustat firms. The analysis tests for the industry-adjusted return on investment as a function of population density.

The results, which are both statistically and economically significant, show that firms headquartered in smaller cities tend to outperform those located in major business centers.

These results suggest at least two implications for financial managers. One is that headquarters location should be considered as a key element of financial management strategy. The second is that businesses should very carefully consider decisions to move headquarters to the very largest cities.

Theory suggests that business success should increase with the size of the city. This paper, the first large-sample examination of major US firms, shows that businesses with headquarters in smaller locations tend to enjoy greater financial success.

The purpose of this paper is to identify the financial potential of new service businesses in the context of a global machinery manufacturer. The objective is to examine the supportive role of management accounting (MA) and control in service business development, which has not been empirically examined previously.

The paper takes advantage of an interventionist case study at a global machinery manufacturer and is empirically based on a comprehensive examination of the service business potential in the selected product category in different market areas. The researchers were actively involved in the accounting development activities underlying this paper.

The results suggest that the development of a global service business is necessary to build on market area characteristics. An analysis should combine financial information and equipment fleet information across product lines and organizational units.

MA and control practices tend to require significant development to actually support the process of identifying and capturing the service business potentials. As the findings are limited to one case environment, further studies should address the longitudinal evolution of MA and control, and the choice and utilization of different performance measures, in similar contexts.

The paper provides managerial insights on how to utilize MA information and proposes ideas for performance indicators.

The process examined in this paper responds to the need for tools and techniques supporting service business development. MA and control could provide a comprehensive understanding of the dynamics of service business profitability potential and support in identifying and prioritizing the possible avenues of realizing such potential.

This paper aims to conduct an in-depth study of any changes that small medium enterprises (SMEs) environmental performance face, in the retailing and manufacturing sector, as well as to identify their main drivers. Furthermore, it seeks to investigate SMEs’ perspectives regarding the environmental management systems and more specifically International Organisation for Standardisation (ISO) 14001 on the one side, whether it is a positive relationship between the implementation of “ISO 14001” by SMEs and their profitability of business on the other.

This study is a qualitative research, which combines secondary data enriched with daily articles and primary data using in-depth interviews with experts from the SME sectors, which attempts to build a sufficient “theory” by answering the research questions.

The business world has started to get widely involved with the environmental issues and even if this, in some cases, happened only for marketing purposes, it is difficult now to be changed. The SMEs have started to realise their responsibilities and act accordingly, but there is a long way to cover until their actions will be actually beneficial for the environment. However, the improvement or stability of SMEs’ environmental performance, meaning the implementation of more environmental activities, depends on the impact that those changes will have in every SME, due to the unique idiosyncrasy that each of it consists.

This paper reveals proper method for documenting monetary rewards to entrepreneurship through maintaining environmental issues accurately using information about profitability of SME’s. After maintaining environmental factors, the premia illustrates about the entrepreneurs concentrating not only profitability but also environmental concern.

“Business” services are those services provided for business customers. As a group, this sector has been the largest single division of the US service sector, comprising 25‐30 per cent of services as defined by the Department of Commerce over the 1982 to 1992 decade. A least squares analysis of cross‐sectional information indicated relative market share and revenue per employee were statistically significant components of profitability in this sector. States that focus on these factors may lend direction to the management of services, especially at the strategic level.

The purpose of the present study is to determine how the cash conversion cycle (CCC) affects the financial performance of manufacturing companies in Bangladesh.

The authors have collected data of 61 Dhaka Stock Exchange (DSE)-listed firms from the 10 distinct manufacturing industries of Bangladesh for 18 years, from 2003 to 2020. The data have been analyzed through the two-steps system generalized method of moment (GMM) regression model, using profitability indicators return on asset (ROA) and earnings per share (EPS) as dependent variables, while CCC has been used as the independent variable, whereas asset turnover (ATO) and financial leverage (LEV) were used as control variables to assess the relationship between the CCC and financial performance.

The findings indicated that CCC has a negative connection with profitability – ROA and EPS, with the connection between CCC and EPS being highly significant. This indicates that reducing the inventory conversion time, reducing the period of receivable collection and making payments to creditors with potential delays might help Bangladeshi manufacturing firms boost their profitability. In addition, the firm-specific characteristics, namely ATO and LEV significantly affect the firm's profitability.

The research was based only on secondary sources and information was scarce. This research was conducted to determine the impact of the CCC on the corporate profitability of the manufacturing sector solely. There might be many other working capital variables that are still unexplored through this study.

The current study's findings are consistent with the traditional rule that minimizing the firm's days of the cash cycle may optimize financial performance. The results of this research have added to the existing body of knowledge on the topic of working capital management (WCM). Future research endeavors can be initiated for assessing the impact of the CCC on the firm's profitability in other industrial sectors or to identify other working capital variables that have much impact on corporate profitability.

This study is an original work of the researchers and adds value to the current literature in the domain of WCM and corporate profitability. The present study is the first one that covers firms in all the manufacturing industries in Bangladesh. The corporate managers, creditors, investors and other concerned stakeholders will be benefited from the findings of the present study.