Performance Measurement Framework for Business Development Services: Progress Report on the Sustainability and Cost-Effectiveness Indicators Survey

This progress report is part of a global effort to develop a common performance measurement framework (PMF) for business development services (BDS) for small enterprises. The report tracks the achievements of the second goal of the PMF which relates to the sustainability and cost-effectiveness of BDS provider organizations. It highlights that:

• All organizations on the PMF field-research team are attempting to achieve some level of cost recovery or sustainability; however they are struggling to achieve break-even;
• In four of the six programs, the revenues for services are significantly greater than direct costs for delivering the services, indicating that the services themselves are financially profitable;
• Contribution margins among the programs are low, indicating the challenge of covering high overhead costs.

Conclusions of the field-research team regarding the questions on performance assessment techniques, methodology, and interpretation include:

• The indicators for sustainability are valid, practical, and useful;
• Participants used a fairly standard definition of direct cost for services;
• The cost-effectiveness indicators that allocate cost per participant were unrevealing;
• The simplified cost-benefit ratio is of questionable validity.