Business Performance Management Key Performance Indicators and Metrics

Question 1

Which type of KPI measures outcomes that have already occurred and cannot be changed?

Accepted Answer

Lagging indicator

Answer

Leading indicator

Answer

Process indicator

Answer

Input indicator

Question 2

What does the acronym SMART stand for when defining KPIs?

Accepted Answer

Specific, Measurable, Achievable, Relevant, Time-bound

Answer

Strategic, Managed, Actionable, Reliable, Trackable

Answer

Simple, Meaningful, Accurate, Resourced, Timely

Answer

Structured, Monitored, Attainable, Reviewed, Tested

Question 3

A company tracks 'number of new leads generated per month.' This is an example of which type of KPI?

Accepted Answer

Leading indicator

Answer

Lagging indicator

Answer

Financial KPI

Answer

Outcome KPI

Question 4

Which of the following is the BEST example of a customer-focused KPI?

Accepted Answer

Net Promoter Score (NPS)

Answer

Gross profit margin

Answer

Inventory turnover ratio

Answer

Employee headcount

Question 5

What is a KPI cascade in performance management?

Accepted Answer

Aligning organizational KPIs down from strategic to operational levels

Answer

The process of eliminating redundant KPIs

Answer

Reporting KPIs in a waterfall chart format

Answer

Aggregating individual KPIs into a single composite score

Question 6

Which ratio measures how efficiently a company uses its assets to generate revenue?

Accepted Answer

Asset turnover ratio

Answer

Current ratio

Answer

Debt-to-equity ratio

Answer

Price-to-earnings ratio