Many Companies Do Not Identify and Act on the Correct

question 35

Multiple Choice

Many companies do not identify and act on the correct non-financial measures.One of the four major mistakes that companies make is _______.In other words,companies attempt to measure complex phenomenon with one or two simple measures or use quantitative metrics to capture qualitative results for factors such as leadership.

• A) Not linking measures to strategy
• B) Not validating the links
• C) Not setting the right performance targets
• D) Measuring incorrectly
• E) Not creating a balanced scorecard

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Definitions:

Little's Law

A principle in queuing theory stating that the long-term average number of customers in a stable system L is equal to the long-term average effective arrival rate, λ, multiplied by the average time a customer spends in the system, W (L = λW).

Poisson Distribution

The Poisson Distribution is a statistical distribution that expresses the probability of a given number of events occurring in a fixed interval of time or space if these events occur with a known constant mean rate and independently of the time since the last event.

FIFO

An inventory valuation method, "First In, First Out," where the oldest inventory items are recorded as sold first, ensuring that the inventory remains up-to-date.

Steady State

A condition in which all aspects of a system are in equilibrium over time.