Management Finance - Part 1

Goodhart's Law has an important implication for performance management because:

Type: MCQ • Marks: 1
Goodhart's Law has an important implication for performance management because:
Options
A. Every indicator becomes more accurate when used as a target
B. Qualitative assessment should always be abolished
C. Quantitative indicators are always useless
D. A measure used as a target can lose its usefulness as a measure
Explanation
Once individuals are rewarded specifically for achieving a metric, they may optimise the metric rather than the underlying objective.
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UPSC Principal & Vice Principal Management Finance Administration

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