How to calculate competitiveness in the enterprise

Assessing the competitiveness of an enterprise is a determination of the effectiveness of management, the use of production, labor and economic resources and a comparison of the results with similar indicators of competitors. Most often, competitiveness is calculated when drawing up business plans for lending and attracting investments.

Instruction manual

1

Competitiveness is determined on the basis of many factors, but the most objective result is given by mathematical methods of assessment, that is, the calculation of the coefficients and comparing them with industry average indicators. The competitiveness coefficient is the sum of the coefficients of its components: operational efficiency and strategic positioning.

2

Operational efficiency is the best result of the organization's activities among competing enterprises. It is established by the analysis of certain types of activities and is characterized by profit received from the production and sale of products. Its assessment is made by comparing the calculated value for the enterprise in question and the average indicator for the sample, that is, industry average values.

3

Calculate the operating efficiency of the organization by dividing the book revenue without VAT by cost. Next, calculate the operational efficiency of the sample using the formula:

Sampling operating efficiency = Sampling revenue / Sampling cost.

Then determine the coefficient of operational efficiency: divide the obtained value about the enterprise by the indicator for the sample.

4

Strategic positioning is the conduct of activities that differ from competitors both in the nature and uniqueness of the technologies used, which ensure a stable market share, which serves as a basis for assessment. Calculate market share as the ratio of company revenue to market volume and compare the result with the market share for the sample.

5

The company's positioning on the market should be considered in dynamics, therefore, for an objective assessment, determine the indices of changes in the organization’s revenue, revenue by sample in relation to the previous period, dividing the revenue figures by the same values ​​of the previous year.

6

Calculate the coefficient of strategic positioning: divide the index of changes in the company's revenue by the sample index and extract the square root of the quotient.

7

At the final stage, calculate the competitiveness coefficient based on the sum of the operating efficiency coefficients and strategic positioning. A value greater than 1 means high competitiveness of the enterprise, equal to 1 - similar to other enterprises in the industry, and with an indicator less than 1 - low.