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Why a combined Operational and Financial Benchmarking is Needed?

It is normal to come across a comprehensive financial analysis. What is missed is the fact that financial analysis is the end result of the operational performance of a company. Operational performance also highlights key factors that distinguish companies that operate in the developed world (low-interest rates, high wages) and the developing world (normally high-interest rates, low wages) and as a result demonstrating very clearly companies being capital intensive with high productivity and high wages versus companies with low capital equipment and low wages (despite high number of workers).

Operational benchmarking also demonstrates how companies operating in different regions or countries, have distinct factors like higher productivity, higher or lower utility costs, distance from a port, efficient use of raw material, lower import or export duties.

An operationally efficient unit may not be well capitalized and may suffer from an inefficient capital structure (i.e. highly leveraged, or an expensive debt instrument or a debt instrument with shorter tenure than warranted by the business). Some of these factors are not so well understood until these factors are analyzed comprehensively.

If studied together, operational benchmarks will reveal inefficient usage of capital. It is often seen that projects are executed with varied degrees of capital efficiencies. Power plants and other infrastructure projects vary vastly in terms of capital deployed for similar capacities. This inefficient usage of capital impacts the profitability of projects for a long time, sometimes incessantly. Therefore, a combined analysis of operational and financial benchmarking becomes critical to understand such factors.

Televisory is a web based operational and financial benchmarking tool where a company can compare its operational and financial performance with a globally or regionally renowned company, as well as with peers chosen from anywhere in the world. For example, a steel manufacturer in China, exporting to Australia, can make a comparison with another Chinese steel manufacturer who is a competitor and also exports to Australia, or a steel producer in Australia who is also a competitor within the same market, or a steel producer in Korea, Japan or India who competes in the same marketplace. This enables you to compare a business with whoever is considered as the meaningful competitor. Such a comparison, or benchmarking helps a business understand how it can improve and excel. Televisory is the platform to facilitate a meaningful comparison, to enable companies to benchmark for eventual excellence.

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