1. COMPANY DEVELOPMENT POTENTIAL AND PERFORMANCE Brno, May 30 – 31, 2003 Business development and EC Emil Vacík, Jiří Vacek, Jiří Skalický Department of Management, Innovations and Projects, Faculty of Economics, UWB vacekj@kip.zcu.cz http://www.kip.zcu.cz

2. DEVELOPMENT POTENTIAL U-SME Innovation: A model of a university – SME cooperation in innovations, 2001 http://www.kip.zcu.cz/USME Leonardo da Vinci programme – CZ, UK, F

3. DP COMPONENTS Strategy and planning; Marketing; Technological process; Quality, environment; Logistics (purchasing, distribution, outsourcing); Organization and human resources.

5. C, AB, B, A Classes C - not ready to implement development activities AB - ready to changes necessary for improving performance, must consistently improve basic processes B - in principle prepared to undergo a certification process A highly competitive, high performers

6. FIELD RESEARCH Faculty of Management of Tomáš Baťa University in Zlín, 2-nd quarter 2002 –13 - rubber and plastics; –20 - machinery; –12 – steel and steel product; – 5 – mechanical engineering.. 5 companies from Pilsen region 9 AB, 27 B, 14 A, none C

7. STATISTICAL ANALYSIS Marketing component achieved the lowest values Rubber and plastics has the lowest average value of IS and human resources component Steel industry is better than average in Marketing and Logistics, below average in Strategy and planning

8. Cluster analysis

9. Regression Analysis DP = - 0,0037 + 0,1809 * Quality and environment + 0,1683 * Logistics + 0,1938 * Marketing + 0,1488 * IS and human resources + 0,1775 * Strategy and planning + 0,1305 * Production processes and technology

10. DP and Financial Performance Correlation analysis: value of the development potential influences the financial performance of a company financial performance of a company positively influences the value of its development potential

11. Correlations On 95% reliability level between the following coefficients: –ROE and all forms of DP –ROE and ROS –ROE and ROCE –ROA and ROS –ROA and ROCE –ROS and ROCE

12. CONCLUSIONS DP factors can be influenced by the company owners and managers. DP has demonstrable effect on the financial performance and correlate with value creation. The relevancy of development potential components was demonstrated by statistical methods.

13. Marketing most sensitive factor its values in our sample were the lowest companies generally have lack of information about customers behaviour And this influences management decision making in critical situations involving high risk.

14. Production processes and technologies component achieves the highest values for industries in our sample this component is always important provides the best one-component estimate of DP and its correlation with ROE is the strongest leading position in technology and high quality products - attractive for top employees, satisfy their customers.

15. Strategy and planning significantly influences classification of companies according to their DP its explaining power is low dependence between the performance measurement and the strategy is rather weak.

16. Recommendations two-sided correlation between DP and financial performance supports efficient implementation of company goals and objectives DP together with selected financial indicators can be a valuable tool in evaluation of company owners ambitions and expectations

17. THANK YOU FOR YOUR ATTENTION