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Key Performance Indicators (KPI)
book

Key Performance Indicators (KPI)

by Bernard Marr
September 2012
Intermediate to advanced
376 pages
6h 44m
English
FT Publishing International
Content preview from Key Performance Indicators (KPI)

15

Working capital ratio

Strategic perspective

Financial perspective

Key performance question this indicator helps to answer

How well are we managing our cash flow?

Why is this indicator important?

We discussed the importance of cash flow in our previous KPI. The simple truth is that in order to build the business an organisation needs a healthy supply of cash. Without readily available cash an organisation will struggle to grow and will equally be challenged to fund day-to-day operational activities. To understand the cash position, organisational leaders will typically use the working capital ratio as another key cash-flow measure.

In essence, working capital (also referred to as current position) is a measure of current assets minus ...

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Publisher Resources

ISBN: 9780273750116