Definition: Qualitative factors are outcomes from certain actions that are difficult or impossible to measure. Every decision a manager or supervisor makes deals with relevant costs and revenues. Managers try to predict what the future costs and the future revenues will be if a certain action is taken or decision is made.
What Does Qualitative Factor Mean?
For example, a manager might be considering adding an extra 15-minute break in the afternoon for employees. The manager looks at what the advantages and disadvantages are for adding breaks in the afternoon from a cost and revenue standpoint. This is where qualitative factors are also considered.
Employee morale would also be considered a qualitative factor in favor of establishing new breaks for employees. The employee morale would be improved considerably if break were added in the afternoon. Another morale booster could be giving gifts or bonuses to each employee.
Employee morale is extremely important for all successful companies and most large companies spend huge sums of money keeping their employees happy. Google for example, has full cafeterias where all employees can eat for free any time of the day. This is a huge expense to Google, but employee morale is lifted because of it. The only problem is that employee morale is difficult to measure and quantify. You can’t really measure morale before and after the breaks are initiated. That is why most management decisions are based on quantifiable factors instead of qualitative factors.