Distinguish between lead indicators and lag indicators, and provide an example of each. Which of these indicators is a better guide for strategic planning?


A lag indicator is an outcome that has resulted from past actions. A common lag indicator is profitability. Other similar performance measures are also acceptable answers.

A lead indicator reflects future financial and nonfinancial outcomes. A good example of a lead indicator would be the number of employees trained on a new transaction processing system. Lead indicators are better guides for strategic planning, because they provide information on outcomes more quickly than do lag indicators.

Business

You might also like to view...

An individual or group health plan that provides or pays the cost of medical care may not:

A. be able to safeguard employee privacy. B. disclose protected health information. C. use the employer's ability to deny coverage for a preexisting condition. D. none of these.

Business

The Model Business Corporation Act has been adopted by all of the states in the United States, thereby making state incorporation statutes uniform throughout the United States

Indicate whether the statement is true or false

Business

Rave Reviews Company has two service departments (Cafeteria and Human Resources) and two production departments (Machining and Assembly). The number of employees in each department follows.Cafeteria40Human Resources60Machining200Assembly300Rave Reviews uses the direct method of cost allocation and allocates cost on the basis of employees. If Human Resources cost amounts to $1,800,000, how much of the department's cost would be allocated to Assembly?

A. $1,080,000. B. $720,000. C. $1,200,000. D. $900,000. E. None of the answers is correct.

Business

List and describe the principal corporate-level strategies that managers can use to help a company maintain or grow its position in an industry or reorganize to stop a decline.

What will be an ideal response?

Business