Deck 10: Performance Management

Question 1

Which of the following statements is true about the various customer metrics?

A) The new customer metric is measured by the total number of positive feedbacks received from new and existing customers.
B) Some companies find it valuable to monitor the amount customers spend on their products relative to all other products.
C) Retaining existing customers to maintain or increase market share is not an easy task.
D) Customer satisfaction is one of the metrics that is the most objective and quantitative.

Answer 1

B

Question 2

Which of the following refers to the quantitative and qualitative things that are most important to customers?

A) Financial economies
B) Core competencies
C) Value propositions
D) Internal business processes

Answer 2

C

Question 3

Which of the following is a main function of a control cycle?

A) It improves the skills of employees needed to carry out business processes.
B) It helps managers create a set of quantitative measurements that are unrelated.
C) It helps to make high level strategy more concrete and tangible.
D) It enables employees to identify gaps in capabilities or resources.

Answer 3

C

Question 4

The management of Z-Cosmetics,after identifying key measurements,decided to set performance targets for its business.In order to fulfill the purpose,it adopted a process which required the management to collect data from Color Cosmetics,a leading manufacturer in the industry.The managers of Z-Cosmetics believed that adopting the best practices across the industry would help them achieve their goals more effectively.Identify the process used by Z-Cosmetics to set performance targets.

A) Activity-based costing
B) Benchmarking
C) Total Quality Management
D) Budgeting

Question 5

Which of the following statements about the balanced scorecard is true?

A) Balanced scorecard can be adapted to align with unique company goals.
B) It does not enable managers to make any qualitative measurements.
C) A company with many business units needs only a single balanced scorecard.
D) Company mission plays an instrumental role in the balanced scorecard.

Question 6

Internal business processes are important because:

A) they are the quantitative and qualitative things that customers value most.
B) they link key customer-based metrics such as market share to the financial performance of a firm.
C) they focus mainly on choosing the financial measurements that are important for reaching strategic goals.
D) they represent the day-to-day operations that deliver products and services to customers.

Question 7

Which of the following is one of the most important internal business process measures?

A) On-base percentage
B) Activity-based costing
C) Six Sigma
D) Return on equity

Question 8

The _____ perspective identifies the infrastructure and skills needed to carry out business processes,interact with customers,and achieve long-term financial growth.

A) customer
B) learning and growth
C) financial
D) business process

Question 9

In business,only two things can be observed,measured,and monitored:

A) suppliers and customers.
B) behavior and outputs.
C) resources and growth.
D) employee satisfaction and loyalty.

Question 10

Which of the following perspectives refers to the framework that identifies the infrastructure and skills needed to carry out business processes,interact with customers,and achieve long-term financial growth?

A) Internal business process perspective
B) Customer perspective
C) Learning and growth perspective
D) Financial perspective

Question 11

Which of the following questions should the managers address as they design control systems?

A) What it is?
B) Who should design?
C) How to design?
D) Is it relevant?

Question 12

The factor that differentiates outcomes from drivers in business is that:

A) outcomes can be efficiently measured without drivers.
B) outcomes are generic measurements commonly used.
C) outcomes are key areas to predict future success.
D) outcomes are more unique to company strategy.

Question 13

The _____ was created to help businesses translate strategy into action by identifying the most critical measures to drive business success and linking long-term strategic goals with short-term operational actions.

A) ISO 9000 program
B) strategic review process
C) balanced scorecard
D) value chain analysis

Question 14

Which of the following is the most valuable benefit of the balanced scorecard?

A) Its usefulness in creating the vision,mission,and objectives of a firm
B) Its creation of a strong culture which provides role clarity to employees
C) Its facilitation of communication about strategy throughout an organization
D) It flexibility toward employees allowing them to make their own decisions

Question 15

The factor that differentiates behavior and output is that:

A) outputs include the decisions of individual employees.
B) behavior is controlled at the local level.
C) outputs are more flexible and diverse.
D) behavior can be specified for an entire organization.

Question 16

_____ refers to a four-stage process that provides the mechanisms and systems that monitor the transformation process,ensuring that outputs are produced to the desired quality,quantity,and specification of an organization.

A) Control cycle
B) Trend analysis
C) Scenario building
D) SWOT analysis

Question 17

ColorZone,a cosmetics manufacturing company,introduced a new range of cosmetics targeting the younger population.The company spent a lot on advertisements in an attempt to reach more customers and increase sales.However,the money invested on promotion overweighed the sales profit in the initial months.From this scenario it can be inferred that the company is in the _____ of business.

A) final phase
B) growth stage
C) strategic phase
D) harvest stage

Question 18

Which of the following is the first step involved in benchmarking?

A) Harvesting and analyzing data
B) Finding the best companies for each process
C) Identifying the processes to benchmark
D) Creating plans for improvement

Question 19

The accounting system used to assess the specific cost components of producing a product or service is known as _____.

A) economic value added
B) return on equity
C) activity-based costing
D) economies of scale

Question 20

Which of the following statements is true about the financial perspective of a balanced scorecard?

A) Economic value added refers to a measure of the value a company provides to its shareholders.
B) During the growth stage,profitability outweighs investment.
C) When an organization introduces a new product,business is in the sustain phase.
D) The harvest stage is the stage of business where the company is investing and extracting money.

Question 21

While a business is in the harvest stage,investment outweighs profitability.

Question 22

Discuss TQM,Six Sigma and ISO 9000.

Question 23

_____ is an international control mechanism that pursues high-quality products by ensuring high-quality processes.

A) ISO 9000
B) Benchmarking
C) Six Sigma
D) Total Quality Management

Question 24

Define control cycle and explain how it is used to improve the firm's performance.

Question 25

List four benefits of interactive control systems.

Question 26

_____ is defined as the process of evaluating behaviors and outputs to see whether standards have been met or objectives have been obtained.

A) Benchmarking
B) Measurement
C) De-escalation
D) Strategic control

Question 27

Internal business processes are important because they represent the day-to-day operations that deliver products and services to customers.

Question 28

ISO 9000 is a program that focuses on improving the firm's products but not the processes involved.

Question 29

Describe benchmarking.

Question 30

_____ is the process of recalibrating or confirming a firm's strategy in light of changes in the external environment.

A) Strategic positioning
B) Value chain analysis
C) Strategic control
D) Benchmarking

Question 31

The control cycle helps to make high level strategy more concrete by breaking it down into operational objectives.

Question 32

What is a balanced scorecard? Briefly describe its perspectives.

Question 33

For the balanced scorecard to be valuable,measurements from the customer perspective must link directly to financial results.

Question 34

_____ is a quantitative approach that uses a method known as DMAIC,which stands for define,measure,analyze,improve,and control.

A) Benchmarking
B) Six Sigma
C) Budgeting
D) Total Quality Management

Question 35

Interactive control systems promote continuous communication between managers and subordinates throughout the entire organization.

Question 36

Measuring drivers without outcomes leads to confusion and wasted resources.

Question 37

Which of the following is the ultimate goal of Total Quality Management?

A) Producing sustainable revenue
B) Setting strategic priorities
C) Satisfying customer needs
D) Improving employee performance

Question 38

Market share of target customers may increase at the same time there is an increase in non-target markets,showing that the company is not meeting strategic objectives.

Question 39

The control cycle includes a mechanism to improve a business's response to the external environment,known as strategic control.

Question 40

Benchmarking involves allocating and measuring expected quantitative and qualitative outcomes of a firm.