An IBM study released today reveals that companies in the electronics industry who adopt a flexible, adaptive, on-demand business model can produce up to twice the revenue per employee and more than twice the operating income per employee than less mature companies.
According to the study, The On Demand Outlook for the Electronics Industry, average revenue per employee for electronics companies surveyed for the period 1998-2002 was about US$300,000 for companies implementing on-demand business models vs. US$150,000-250,000 for less mature companies. Average operating income per employee for the same period was US$40,000 (mature) vs. US$17,000 (immature).
The study was based on detailed analysis of publicly available financial and operational data on 24 of the world’s leading electronics companies. It analyzed such attributes as focus on core competencies, use of variable cost structures and business processes, and the ability to predict and pre-empt changes in the marketplace. Overall, it determined that companies that are more advanced in these areas are better equipped to achieve improved financial performance.
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