Chapter 2: Measuring Business Decisions

Question 1

Project

Answer 1

A temporary activity a company undertakes to create a unique product, service, or result

Question 2

Metrics

Answer 2

Measurements that evaluate results to determine whether a project is meeting its goals

Question 3

Critical success factors (CSFs)

Answer 3

The crucial steps companies make to perform to achieve their goals and objectives and implement strategies.

Ex. Increase customer satisfaction,
Hire and retain the best professionals

Question 4

Key performance indicators (KPIs)

Answer 4

The quantifiable metrics a company uses to evaluate progress toward critical success factors

Ex. Number of product returns,
Number of new customers

Question 5

External KPI

Market Share

Answer 5

The portion of the market that a firm captures

Question 6

Internal KPI

Return on Investment (ROI)

Answer 6

Indicates the earning power of a project

Question 7

Efficiency MIS Metrics

Answer 7

Measure the performance of MIS itself, such as throughput, transaction speed, and system availability

Question 8

Effectiveness MIS Metrics

Answer 8

Measures the impact MIS has on business processes and activities, including customer satisfaction and customer conversation rates

Question 9

Name 5 Efficiency Metrics

Answer 9

1) Throughput
2) Transaction Speed
3) System Availability
4) Information Accuracy
5) Response Time

Question 10

Name 4 Effectiveness Metrics

Answer 10

1) Usability
2) Customer Satisfaction
3) Conversion Rates
4) Financial

Question 11

Benchmarking

Answer 11

A process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and procedures to improve system performance