Reference no: EM132897227

Instructions: Read and analyze each statement. Specify what indicators are described and evaluate how these indicators are important in the measurement of process performance.

1. A product or service cannot meet customer needs unless the enterprise perceives customer needs and designs a product or service to fulfill those needs. Then, in delivering the product or service, the enterprise must conform to the design specifications. Only by getting both the design and the delivery correct can an enterprise provide a quality product or service.

2. Any delay in any of the critical activities causes a delay in the entire process. For this reason, management should pay special attention to the critical activities by providing them with all of the needed resources and monitoring their execution very closely. On the other hand, non-critical activities are not so decisive for the process cycle time because any delay caused by a non-critical activity could be more easily made up, and such a delay usually does not cause a holdup in the whole process.

3. Labor can be a fixed cost or a variable cost; it depends on how the employees are paid. An accountant is a fixed cost if paid a salary, whereas a truck driver is a variable cost because the truck driver is paid per hour spent driving.

4. Resources are essential for performing the process activities. The capacity of a process depends on the resources (e.g., capital and labor) used in the process. Moreover, every activity depends on the availability and ability of the resources required for its execution; while performing any activity requires one or more resources, every resource may be involved in performing one or more activities.