Question 1

Elements that derive from the competitive strategy and are essential to the success of the organisation are called:

Accepted Answer

A)  key performance indicators. 
B)  critical success factors. 
C)  key performance factors. 
D)  critical success drivers. 
A)  key performance indicators. 
B)  critical success factors. 
C)  key performance factors. 
D)  critical success drivers.

Question 2

Organisations that aim to become and remain world-class will strive for:

Accepted Answer

A)  continuous improvement. 
B)  greater profitability. 
C)  increased investment. 
D)  market leadership. 
A)  continuous improvement. 
B)  greater profitability. 
C)  increased investment. 
D)  market leadership.

Question 3

In production, the time taken to get materials and machinery ready for a run is termed set-up time.

Accepted Answer

A) True 
 B)False

Question 4

The Du Pont chart identifies linkages between key performance drivers, key performance indicators and financial performance measures.

Accepted Answer

A) True 
 B)False

Question 5

One way of setting up a system of continuous improvement is to utilise benchmarking for comparing products functions and activities.

Accepted Answer

A) True 
 B)False

Question 6

Benchmarking that involves comparison with firms with similar interests and technologies is termed:

Accepted Answer

A)  competitive benchmarking. 
B)  industry benchmarking. 
C)  process benchmarking. 
D)  external benchmarking. 
A)  competitive benchmarking. 
B)  industry benchmarking. 
C)  process benchmarking. 
D)  external benchmarking.

Question 7

Benchmarking that involves comparison with best practices that occur in any industry is termed:

Accepted Answer

A)  internal benchmarking. 
B)  industry benchmarking. 
C)  process benchmarking. 
D)  external benchmarking. 
A)  internal benchmarking. 
B)  industry benchmarking. 
C)  process benchmarking. 
D)  external benchmarking.

Question 8

Which of the following is the most appropriate lead indicator in relation to 'customer satisfaction rating'?

Accepted Answer

A)  Market share 
B)  Number of customer complaints 
C)  Percentage of on-time delivery 
D)  Sales growth 
A)  Market share 
B)  Number of customer complaints 
C)  Percentage of on-time delivery 
D)  Sales growth

Question 9

Performance measures, including shareholder value, residual value and cash flow are related to:

Accepted Answer

A)  financial perspective. 
B)  customer perspective. 
C)  internal business processes. 
D)  learning and growth. 
A)  financial perspective. 
B)  customer perspective. 
C)  internal business processes. 
D)  learning and growth.

Question 10

Assuming you must choose one measure only, which of the following non-financial performance indicators would most likely be chosen to measure productivity?

Accepted Answer

A)  Units produced per month 
B)  Number of repeat orders 
C)  Percentage of absenteeism 
D)  Percentage of idle time 
A)  Units produced per month 
B)  Number of repeat orders 
C)  Percentage of absenteeism 
D)  Percentage of idle time

Question 11

Which of the following statements are limitations associated with traditional performance measures?
i. They may encourage short-term financial performance.
ii. They describe results not causes.
iii. They do not emphasise areas that need development for long-term goal achievement.

Accepted Answer

A)  i and ii 
B)  ii and iii 
C)  i and iii 
D)  All of the given answers 
A)  i and ii 
B)  ii and iii 
C)  i and iii 
D)  All of the given answers

Question 12

Some of the measures that can be used for measuring competitiveness include market ratios, capital structure and liquidity.

Accepted Answer

A) True 
 B)False

Question 13

Benchmarking
Explain the different ways in which benchmarking may be achieved and the limitations of each.

Accepted Answer

Internal benchmarking Benchmarkin

Question 14

The steps to be taken in the benchmarking process are:
i. establishing performance goals.
ii. identifying functions or activities to be benchmarked.
iii. implementing plans.
iv. data collection and analysis.
v. selecting benchmark partners.
What is the correct sequence of these steps?

Accepted Answer

A)  i, ii, iii, iv and v 
B)  ii, v, iv, i and iii 
C)  iii, ii, i, v and iv 
D)  ii, v, i, iv and iii 
A)  i, ii, iii, iv and v 
B)  ii, v, iv, i and iii 
C)  iii, ii, i, v and iv 
D)  ii, v, i, iv and iii

Question 15

Modern measurement systems
What are the essential limitations associated with the use of non-financial measures?

Accepted Answer

Limitations associated with the use of n

Question 16

Employee satisfaction, absenteeism and employee suggestions implemented are measures related to:

Accepted Answer

A)  financial perspective. 
B)  customer perspective. 
C)  internal business processes. 
D)  learning and growth. 
A)  financial perspective. 
B)  customer perspective. 
C)  internal business processes. 
D)  learning and growth.

Question 17

Which of the following are likely to be the result of concentration on short-term performance measures?
i. Reduced expenditure on product development
ii. Increased spending on new technology
iii. Increased employee training
iv. Reduced marketing effort

Accepted Answer

A)  i and ii 
B)  i and iii 
C)  i and iv 
D)  ii and iv 
A)  i and ii 
B)  i and iii 
C)  i and iv 
D)  ii and iv

Question 18

Which of the following is the most appropriate lag indicator in relation to 'customer satisfaction rating'?

Accepted Answer

A)  Sales growth 
B)  Number of customer complaints 
C)  Percentage of employees with tertiary qualifications 
D)  Percentage of on-time delivery 
A)  Sales growth 
B)  Number of customer complaints 
C)  Percentage of employees with tertiary qualifications 
D)  Percentage of on-time delivery

Question 19

A firm using the balanced scorecard has included among its strategies 'to improve bottom-line profit we need to improve working conditions'. Which of the following statements best describes the evaluation of the firm's success in implementing the strategy?

Accepted Answer

A)  It is impossible to determine whether the strategy has been successful. 
B)  The only way to measure success is to survey employees. 
C)  A number of performance evaluation measures will need to be put in place, but even with favourable results on those measures, the firm cannot conclude that the profit resulted from the improvement in working conditions. 
D)  If managers can observe employees' motivation they will have a good idea of the success or otherwise of the strategy. 
A)  It is impossible to determine whether the strategy has been successful. 
B)  The only way to measure success is to survey employees. 
C)  A number of performance evaluation measures will need to be put in place, but even with favourable results on those measures, the firm cannot conclude that the profit resulted from the improvement in working conditions. 
D)  If managers can observe employees' motivation they will have a good idea of the success or otherwise of the strategy.

Question 20

Measures that monitor the factors that drive outcomes are called:

Accepted Answer

A)  lead indicators. 
B)  lag indicators. 
C)  benchmark indicators. 
D)  cause and effect indicators. 
A)  lead indicators. 
B)  lag indicators. 
C)  benchmark indicators. 
D)  cause and effect indicators.

Exam 14: Strategic Performance Measurement Systems

Elements that derive from the competitive strategy and are essential to the success of the organisation are called:

Organisations that aim to become and remain world-class will strive for:

In production, the time taken to get materials and machinery ready for a run is termed set-up time.

The Du Pont chart identifies linkages between key performance drivers, key performance indicators and financial performance measures.

One way of setting up a system of continuous improvement is to utilise benchmarking for comparing products functions and activities.

Benchmarking that involves comparison with firms with similar interests and technologies is termed:

Benchmarking that involves comparison with best practices that occur in any industry is termed:

Which of the following is the most appropriate lead indicator in relation to 'customer satisfaction rating'?

Performance measures, including shareholder value, residual value and cash flow are related to:

Assuming you must choose one measure only, which of the following non-financial performance indicators would most likely be chosen to measure productivity?

Which of the following statements are limitations associated with traditional performance measures? i. They may encourage short-term financial performance. ii. They describe results not causes. iii. They do not emphasise areas that need development for long-term goal achievement.

Some of the measures that can be used for measuring competitiveness include market ratios, capital structure and liquidity.

Benchmarking Explain the different ways in which benchmarking may be achieved and the limitations of each.

The steps to be taken in the benchmarking process are: i. establishing performance goals. ii. identifying functions or activities to be benchmarked. iii. implementing plans. iv. data collection and analysis. v. selecting benchmark partners. What is the correct sequence of these steps?

Modern measurement systems What are the essential limitations associated with the use of non-financial measures?

Employee satisfaction, absenteeism and employee suggestions implemented are measures related to:

Which of the following are likely to be the result of concentration on short-term performance measures? i. Reduced expenditure on product development ii. Increased spending on new technology iii. Increased employee training iv. Reduced marketing effort

Which of the following is the most appropriate lag indicator in relation to 'customer satisfaction rating'?

A firm using the balanced scorecard has included among its strategies 'to improve bottom-line profit we need to improve working conditions'. Which of the following statements best describes the evaluation of the firm's success in implementing the strategy?

Measures that monitor the factors that drive outcomes are called:

Management Accounting: Information for Creating Value and Managing Resources

Management Accounting: Cost Terms and Concepts

Cost Behaviour, Cost Drivers and Cost Estimation

Product Costing Systems

Process Costing and Operation Costing

Service Costing

A Closer Look at Overhead Costs

Activity-Based Costing

Budgeting Systems

Standard Costs for Control: Direct Material and Direct Labour

Standard Costs for Control: Flexible Budgets and Manufacturing Overhead

Managing and Reporting Performance

Financial Performance Measures and Incentive Schemes

Managing Suppliers and Customers

Managing Costs and Quality

Sustainability and Management Accounting

Cost Volume Profit Analysis

Information for Decisions: Relevant Costs and Benefits

Pricing and Product Mix Decisions

Information for Capital Expenditure Decisions

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