OM Performance Management & KPIs Flashcards

What is the primary difference between an OKR (Objectives and Key Results) and a traditional KPI?

Answer: OKRs set aspirational goals with measurable results to track progress, while KPIs monitor ongoing operational performance

OKRs drive ambitious goal-setting and progress tracking, while KPIs are used for monitoring ongoing operational health and performance standards.

A department head wants to improve team performance but realizes targets have not been reviewed in three years. What is the FIRST step they should take?

Answer: Benchmark current performance targets against industry standards and organizational goals

Benchmarking current targets against industry standards and current organizational goals ensures that performance expectations are both realistic and strategically aligned.

What is the purpose of a Performance Improvement Plan (PIP) in organizational management?

Answer: To provide a structured framework with specific goals and timelines to help underperforming employees improve

A PIP outlines specific performance deficiencies, measurable improvement goals, and a timeline to give employees a fair and supported opportunity to meet expectations.

Which performance management approach involves setting a small percentage of employees as 'top performers,' 'average,' and 'low performers' in a fixed ratio each review cycle?

Answer: Forced ranking (stack ranking)

Forced ranking (or stack ranking) mandates that a predetermined percentage of employees fall into each performance tier, regardless of actual overall performance levels.

An organization wants to shift from annual performance reviews to continuous performance management. What is the MAIN benefit of this shift?

Answer: It provides timely, actionable feedback that enables employees to improve in real time

Continuous performance management enables real-time coaching and course correction, rather than waiting until year-end when it's too late to act on the feedback.

What is 'performance calibration' in the context of organizational management?

Answer: A process where managers align and standardize performance ratings across teams to ensure fairness and consistency

Performance calibration sessions bring multiple managers together to compare and align ratings, reducing bias and ensuring equitable application of performance standards across the organization.