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Strategic Management and Performance Metrics Flashcards

6 cards from real CPIM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 6 Strategic Management and Performance Metrics flashcards as text

  1. Which performance metric measures the percentage of customer orders shipped complete and on time?

    Answer: Perfect order fulfillment rate

    Perfect order fulfillment rate measures the percentage of orders delivered complete, on time, undamaged, and with accurate documentation.

  2. In CPIM, what does 'inventory turnover' measure?

    Answer: The number of times inventory is replenished per year relative to average inventory value

    Inventory turnover = Cost of Goods Sold / Average Inventory Value, indicating how many times inventory is cycled through per period.

  3. What is 'days of supply' (DOS) as a supply chain metric?

    Answer: The number of days the current inventory can cover future demand at the average daily usage rate

    Days of supply = (Inventory on Hand) / (Average Daily Usage), showing how long current stock will last before a stockout occurs.

  4. Which CPIM concept measures the actual output of a process compared to the planned or theoretical output?

    Answer: Efficiency

    Efficiency = (Actual Output / Standard Output) × 100, comparing actual performance to the engineered standard.

  5. A company achieves a 95% on-time delivery rate but ships incomplete orders 10% of the time. What is the approximate perfect order rate?

    Answer: 85.5%

    Perfect order rate ≈ 0.95 × 0.90 = 0.855 or 85.5%, since each dimension must be multiplied together (assuming independence).

  6. What does 'cash-to-cash cycle time' measure in supply chain performance?

    Answer: Time from paying for materials to receiving payment from customers

    Cash-to-cash cycle time = Days Inventory Outstanding + Days Sales Outstanding – Days Payable Outstanding, measuring how long cash is tied up in operations.