Performance Management & Metrics Flashcards
7 cards from real CSM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Performance Management & Metrics flashcards as text
What is the primary risk of relying solely on financial metrics in a strategic performance management system?
Answer: They are lagging indicators that signal past performance, potentially missing early warning signs
Financial metrics are predominantly lagging indicators, meaning problems may only become visible after strategic damage has already occurred.
A company tracks both its defect rate and on-time delivery rate as performance metrics. These are examples of:
Answer: Output metrics
Defect rate and on-time delivery measure the quantity and quality of outputs produced by organizational processes.
Which scenario best illustrates 'Goodhart's Law' in performance management?
Answer: When call center agents reduce call duration to hit a time metric, even if customer issues go unresolved
Goodhart's Law states that when a measure becomes a target, it ceases to be a good measure — agents game the metric at the expense of the underlying goal.
In a performance review cycle, a 360-degree feedback process collects input from:
Answer: The employee's manager, peers, direct reports, and sometimes customers
360-degree feedback aggregates performance perspectives from multiple stakeholders across hierarchical levels to provide a comprehensive evaluation.
What does an EBITDA margin indicate in corporate performance measurement?
Answer: Operational profitability before non-cash and financing factors are applied
EBITDA margin shows how much operational profit a company generates as a percentage of revenue, stripping out financing and accounting effects.
When cascading organizational KPIs to team level, which principle is most important?
Answer: Team KPIs must be directly traceable to and supportive of organizational-level strategic objectives
Effective KPI cascading ensures that team-level metrics are derived from and contribute directly to the broader strategic goals of the organization.
A strategic manager wants to measure whether a new market entry strategy is working. Which metric combination provides the most balanced view?
Answer: Market share gained, customer acquisition rate, and revenue from the new market
Market share, acquisition rate, and new market revenue directly measure strategic impact, covering competitive position, growth, and financial return.