Read the passage and answer the following questions:

XYZ Logistics faced challenges in meeting delivery deadlines, leading to customer complaints. The management decided to implement a structured control process to ensure timely deliveries.

The company set a standard of delivering 95% of orders within the promised timeframe. A tracking system was introduced to monitor real-time delivery progress, ensuring accurate data collection. Monthly reports revealed that only 85% of orders were delivered on time, falling short of the 95% benchmark. Analysis showed delays occurred due to inefficient route planning and uncoordinated warehouse operations.

To address these issues, XYZ Logistics optimized route planning using Al-based software and trained warehouse staff to streamline operations.

After implementing changes, performance improved to 92% within the first month and met the 95% target in three months. Management regularly reviewed the system to maintain performance.

By implementing all elements of the controlling process, XYZ Logistics ensured continuous improvement and customer satisfaction.

What was the performance gap initially identified?

10%

The correct answer is Option 2: 10%

The performance gap is the difference between the set standard and the actual performance.

• Standard Set: $95\%$ of orders delivered on time.

• Actual Performance (Initial): $85\%$ of orders delivered on time.

• Performance Gap: $95\%-85\%=10\%$