B3-M4 Performance Management 1

Question 1

what is performance report?

Answer 1

performance report is specific and short term

Question 2

what is control chart?

Answer 2

a control chart shows the performance of a particular process in relation to acceptable upper and lower limits of deviation

Question 3

what is pareto diagram?

Answer 3

a pareto diagram represents an individual and cumulative graphical analysis of errors by type

Question 4

what is fishbone diagram?

Answer 4

a fishbone diagram describes a process, the contributions to the process, and the potential problems that occur at each phase of a process. Manpower, machinery, methods, and materials are commonly identified elements of manufacturing process that would be used to evaluate the source of defects

Question 5

what is an investment center responsible for?

Answer 5

revenues, expenses, and invested capital

Question 6

what is controllable margin?

Answer 6

It is computed as contribution margin net of controllable costs. Controllable costs represent those fixed costs that managers can impact in less than one year.

Question 7

what is balanced scorecard?

Answer 7

balanced scorecard gathers information on multiple dimensions of an organization’s performance defined by critical success factors necessary to accomplish the firm’s strategy. Critical success factors:
- financial solvency and return
- internal business processes
- customer satisfaction
- advancement of innovation and human resources development (learning and growth)

Question 8

what are conformance costs?

Answer 8

Conformance costs ensure quality standards are classified as prevention and appraisal costs
- prevention costs: to prevent production of defective units
- appraisal costs: to discover and remove defective parts before they are shipped to customers or next department. detect individual products that do not conform to specifications. appraisals include the cost of statistical quality control

Question 9

what are non-conformance costs?

Answer 9

• internal and external failure costs such as lost sales or reputation damages
• internal failure costs are costs of fixing defective products, not detecting them
• external failure costs are cost result when defective goods are not detected and are sold to a customer