Which of the following is an example of a non-financial performance measure?

Employee turnover rates are a prime example of a non-financial performance measure because they assess aspects of a business that do not directly relate to monetary values. Non-financial performance measures are often used to evaluate operational efficiency, employee satisfaction, and overall organizational health.

By looking at employee turnover rates, a company can gain insights into its workforce stability and the effectiveness of its hiring and training processes. High turnover can indicate dissatisfaction among employees or issues in management practices, which may ultimately affect financial performance in the long run. Tracking this metric allows companies to understand employee engagement and retention strategies, which are crucial for maintaining productivity and a positive workplace culture.

In contrast, profit margins, sales revenue, and net income are all financial performance measures as they quantify monetary results and reflect a company’s financial health. They focus on the financial outcomes of a company’s operations rather than the processes or workforce dynamics that non-financial measures, like employee turnover rates, illuminate. Thus, employee turnover rates stand out as a critical indicator of non-financial performance within an organization.