Fundamentals of performance measurement quiz PDF

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Fundamentals of performance measurement design – Take-home quiz This quiz is designed to test and give you feedback on your knowledge of the basic concepts introduced in Lecture 2. We recommend that you replicate exam style conditions to complete this quiz, i.e. print and write on it with pen; set yourself a timer (approx. 25 minutes); work independently in a quiet place. a. Indicate the correct order of a ‘cybernetic loop’ in performance measurement (label each step 1-5): _4_ evaluate variance _5_ take corrective action _2_ measure actual performance _1_ establish standards of performance _3_ calculate variance 2) Think about an individual who trains to compete in the 100m running final of the Olympics: a. Fill these boxes to provide an example of what is an input, activity, output and outcome of this scenario for this individual

Energy and Man hours

Training, and Healthy Eating

Running in 100m Final

Position e.g. winning race

b. How could you measure the individual’s output? What would be a relevant: i. performance measure (including units) ______Hours of training _ ii. target (for that measure)

__ seconds to complete 100M race____

c. Explain how this output measure (from b) be used to give feedback to the runner? The feedback of hour many relevant hours the runner would need to adhere to or reach could be provided to correlate with the number of seconds in which he could run the 100 Metre race. The more hours of training and exercising would mean the faster he would be able to finish the race and lower the variable of seconds per/m 3) Steve is trying to improve the development of new products, by giving members of the R&D team cash bonuses based on the number of patent applications they file with regulators. However, some employees are knowingly filing applications that are incomplete or copies of existing patents. Is an example of (circle one): Gaming OR Manipulation Explain why? This practice of submitting incorrect and multiple copied of the same form could be deemed as manipulating the design criteria and rendering it useless. It no longer reflects or measures what it was intended to reflect and provide feedback on.

4) Classify each of the following as either performance; performance measure; or target Return on investment (%) Profitability Average wait time (mins) 4 mins

Measure Target Measure Target

Annual change in profit ($) Timeliness Achieve ROI > 8% $/hour

Measure Target Measure Measure

5) What are the 9 criteria of good performance measurement? Validity

Cost Efficiency

Controllability

Reliability

Timeliness

Cannot be Gamed

Clarity

Access

Cannot be manipulated

6) In the table below are a series of statements describing problems in performance measurement. For each problem identify the relevant criteria of ‘good’ performance measurement Problem in performance measurement

Relevant criteria Reliability

Profit is a meaningless measure of the performance of charities Because of changes to the company privacy policy, the HR department can no longer monitor the time staff spend on social media. The rating my manager gives me for my weekly performance varies depending on his mood. As they get paid per hour, Henry and his friends always work slowly on the production line

Manipulation

Controllability

Gaming

As he only has one product that doesn’t have much overhead costs, Bob thinks it is wrong to change from a plantwide rate system to an ABC system

Cost efficiency

Mary prefers individual assignments rather than group assignments as she doesn’t have to worry about the expertise or motivation of anyone else

Validity

A CFO wanted to improve last year’s profit, so changed the delivery dates so that more sales were recorded in the last period Brian recently received a score of 7.25 for his project but he doesn’t know if that is good or bad. Students are upset that the results of mid-semester exam are only available in Week 12.

Manipulation

Access

Timeliness...