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Hi,
Quotations have been sent to clients either late or containing errors. The department concerned has responded that it is understaffed, and high proportion of current staff has recently joined the firm. The performance of this department is to be carefully monitored.
Which one of the following NFPI would not be an appropriate measure to monitor and improve the department’s performance?
The answer is:
“Percentage of budgeted number of quotations actually issued”. What does it mean?And what does “percentage of department’s quota of staff actually employed” mean? Why is this not the answer?
Suppose they budgeted on issuing 1,000 quotations but actually issued only 800 quotations. Then the percentage of the budgeted quotations actually issued would be 800/1000 = 80%. However this would not be an appropriate measure because it does not look at how many were issued late or had errors, which is what the questions says is the problem in the department.
Suppose they were supposed to have 20 people working in the department (the ‘quota of staff’) but actually only had 15 people employed. Then the % actually employed is 75% of the quota. This is an appropriate measure because it shows they are understaffed which the department claims is a reason for the errors etc..
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