ACCA SP Advanced Performance Management 2

Question 1

Which of the following correctly describes a 'key performance indicator' (KPI)?

Accepted Answer

A quantifiable metric that measures progress toward strategic objectives critical to the organisation's success

Answer

KPIs are measurable values that demonstrate how effectively an organisation is achieving its key business objectives. They are selected to reflect what truly matters strategically.

Question 2

Fitzgerald and Moon's 'building block' model applies to:

Accepted Answer

Service organisations, using dimensions of results and determinants, with standards and rewards

Answer

Fitzgerald and Moon's building block model for service businesses uses: Results (financial performance, competitiveness) and Determinants (quality, flexibility, resource utilisation, innovation), supported by fair Standards and Rewards.

Question 3

The 'divisional autonomy vs central control' dilemma in large organisations refers to:

Accepted Answer

The tension between allowing divisions freedom to make decisions and head office retaining control for coordination and risk management

Answer

Decentralisation grants divisions autonomy (speed, motivation, local knowledge) but risks sub-optimal decisions from a group perspective. The balance between autonomy and central control is a core APM challenge.

Question 4

Which of the following is the primary purpose of 'benchmarking' in strategic performance management?

Accepted Answer

To compare performance against best-in-class standards to identify performance gaps and improvement opportunities

Answer

Benchmarking identifies gaps between current performance and best-in-class standards, providing the foundation for improvement initiatives and more challenging performance targets.

Question 5

In the context of APM, 'Big Data' analytics can improve performance management by:

Accepted Answer

Enabling real-time, granular analysis of large datasets to identify patterns and predict future performance

Answer

Big Data enables organisations to analyse vast, varied and fast-moving datasets in real time, uncovering patterns invisible to traditional reporting and enabling predictive performance management.

ACCA Strategic Professional Practice Test

ACCA Strategic Professional Practice Test

ACCA SP Advanced Performance Management 2