Six Sigma Green Belt Certification Practice Exam

Which metric is an appropriate measure of a profit performance goal?

1. Courtesy rating

2. Return on investment

3. Customer retention

4. Percent defects

The correct answer is: Return on investment

Return on investment (ROI) is a fundamental financial metric used to evaluate the profitability of an investment relative to its cost. As a measure of profit performance, ROI helps businesses understand how effectively they are using their capital to generate profits. By calculating the return generated from an investment, organizations can assess the financial benefits against the costs. This makes ROI a crucial indicator for setting and measuring profit performance goals, as it reflects the direct financial outcome of business activities. In contrast, courtesy rating pertains to customer service quality and does not provide insights into profit performance. Customer retention, while important for overall business sustainability, focuses primarily on maintaining existing customers rather than directly on profit. Percent defects is related to quality control and measures the number of defective products or errors in processes, which is important for operational efficiency but does not directly address profitability. Thus, ROI stands out as the most relevant metric for evaluating profit performance in a clear and quantifiable manner.