DuPont analysis
The Du- Pont- schema or Du Pont measure system ( in the original: DuPont System of Financial Control) is the oldest code system in the world and remains one of the most famous. The oriented to purely monetary system sizes of corporate performance indicators for financial statement analysis and corporate control was developed in 1919 you by the American chemical company DuPont de Nemours and Co.. In other business, the system is used in various versions and additions as control or planning and control tool.
The focus of the performance measurement system is the total return on capital (including return on investment or short ROI ), ie the rate of return on capital employed. The primary goal of corporate governance is therefore not profit maximization, but the maximization of profit per unit of capital inserted. The orientation of the key size to enable ROI in terms of a performance management value-oriented corporate management. All of today's code systems (eg ZVEI performance measurement system ) based on the basic idea of the Du Pont scheme.
The motivation for the development of performance measurement system was the desire for a closed model of mutually conditional targets. Thus, dependencies and interactions are to be made analyzable. With the formal system is turned away from mere collections of isolated measures, as these often lead to inconsistencies with respect to the analysis results.
The Du- Pont- performance measurement system has the formal structure of a computing system, in the form of a pyramid figures. The ROI is determined from the product of the sales profitability and asset turnover.
The peak ratio ROI is first divided into a tree structure in return on sales and turnover rate on capital. In the following stages the in the numerator and denominator of this ratio indicators ( ratios ) are inputted quantities divided in their absolute expenditure and income components, and investment components. The return on sales is profit through sales, the asset turnover is calculated from the sales by average invested capital ( operating assets ). This splitting can be further drive almost unlimited. Due to the mathematical decomposition of the parent target the various influencing factors are clearly displayed on the company's success.
The advantage of the DuPont system is that the measures used are mainly drawn from the corporate accounting and thus are comparable with those of other companies. A major disadvantage is the only retrospective consideration of monetary aggregates ( in contrast, see Balanced Scorecard). The orientation of the short-term profitability target is not considered long-term aspects of the company's value increase. Nor can it be inferred directly the company's productivity, as well as balance sheet policy can be decisive. In addition, the mono targeting is criticized and noted that area-oriented ROI objectives can lead to sub-optimal.