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Answers to supplementary objective test questions

CHAPTER 7 – ALTERNATIVE MEASURES OF PERFORMANCE

7.1

1 % deliveries on time: Internal Processes

2 % Return customers: Customer

3 Revenue growth: Financial

4 % staff up to date with all recommended training: Innovation and Learning

5 % Products returned as unsatisfactory: Customer

6 % projects completed within budget: Internal Processes

7 ROCE: Financial

8 % Employee suggestions implemented: Innovation and Learning

7.2 D

Fixed rewards for hitting target are typical of the traditional approach to
budgeting, whereas beyond budgeting uses stretch goals and relative rewards.
Beyond budgeting has much more local control over the planning process,
which makes it more adaptive and accurate.

III and IV are typical of a beyond budgeting approach.

7.3 C

Competitive (industry) benchmarking looks at the industry as a whole for
comparative purposes.

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