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- W320821543 abstract "Productivity is a measure of how efficiently a company uses its resources. The productivity budgeting model (PBM) is one tool that can aid management in the transition from cost-plus, rate-of-return regulation to the market-oriented, cost-control environment of incentive regulation. Most, if not all, utilities use some type of budgeting/forecasting process that provides the blueprint for future company activity. The PBM reveals the growth in total factor productivity (TFP) implied by a budget and, thus, provides a forecast of the company's future efficiency. The PBM can be used to guide resource usage, because it analyzes investment, labor force, and operating decisions from an economic efficiency perspective. In general, the model makes the budgeting process more relevant to the kind of decisions utility management must make for long-term success under incentive regulation. Furthermore, under many incentive regulation. Furthermore, under many incentive regulation plans (such as the FCC's price-cap plan), a company must meet or beat the productivity offset to increase its profitability. With PBM, the company can determine whether its proposed budget is on track and devise a plan to meet any offset. The PBM can also be used to track productivity using financial data from the period in question." @default.
- W320821543 created "2016-06-24" @default.
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- W320821543 date "1993-06-15" @default.
- W320821543 modified "2023-09-26" @default.
- W320821543 title "Where do we go from here Now that some utilities have won the incentive regulation war, many executives are wondering how they can manage the peace" @default.
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