Which of the following is the PRIMARY requirement before choosing Key performance indicators
of an enterprise?
A.
Determine size and complexity of the enterprise
B.
Prioritize various enterprise processes
C.
Determine type of market in which the enterprise operates
D.
Enterprise must establish its strategic and operational goals
Explanation:
Key Performance Indicators is a set of measures that a company or industry uses to measure
and/or compare performance in terms of meeting their strategic and operational goals. KPIs vary
with company to company, depending on their priorities or performance criteria.
A company must establish its strategic and operational goals and then choose their KPIs which
can best reflect those goals. For example, if a software company’s goal is to have the fastest
growth in its industry, its main performance indicator may be the measure of its annual revenue
growth.
Answer B is incorrect. This is not the valid answer.
Answer A is incorrect. Determination of size and complexity of the enterprise is the selection
criteria of the KRI, not KPI. KPI does not have any relevancy with size and complexity of the
enterprise.
Answer C is incorrect. Type of market in which the enterprise is operating do not affect the
selection of KPIs.