Non financial measures

Question 1

Non-financial measures

Answer 1

help focus attention on the precise problem areas that need improvement and also serve as indicators of future long-run performance.

Question 2

non-financial measures of customer satisfaction

Answer 2

number of customer complaints
defective units as a percentage of total units shipped to customers
percentage of products that experience early or excessive failure
on-time delivery rate

Question 3

non-financial measures of internal performance

Answer 3

number of defects for each product line
process yield (ratio of good output to total output)
employee turnover (ratio of number of employees who have left to the total number of employees)

Question 4

Advantage 1

Answer 4

non-financial measures of quality are often easy to quantify and understand.

Question 5

Advantage 2

Answer 5

non-financial measures direct attention to physical processes and hence focus attention on the precise problem areas that need improvement.

Question 6

Advantage 3

Answer 6

non-financial measures provide immediate short-run feedback on whether quality improvement efforts have succeeded in improving quality.

Question 7

Advantage 4

Answer 7

non-financial measures are useful indicators of future long-run performance.