Measuring Business Strategy Through Balance Scorecard
Organization Using balance scorecard 2 tasks Building Scorecard Using Scorecard Organization Organization Organization
Building Scorecard Financial Customer Internal Learning Return on Investment,  Economic value Added Satisfaction, Retentio...
Financial Perspective
Linking Financial Objectives to Business Unit Strategy 3 Stages Growth Sustain Harvest
Growth <ul><li>Early stage of life cycle </li></ul><ul><li>Products having Growth Potential </li></ul><ul><li>Committing R...
Sustain Stage <ul><li>Attract investments </li></ul><ul><li>Required extra return </li></ul><ul><li>Maintain existing mark...
Harvest Stage Maturity phase Enough to maintain  equipments No expansion New invest with Short  Pay Back Maximize Cash flo...
Strategic Theme for the Financial Perspective Growth Sustain Harvest <ul><li>Revenue Growth Mix </li></ul><ul><li>Cost Red...
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul><ul><li>Sales Growth </li></ul><ul><li>...
Strategic Theme Sales Growth rate by Segment, Percentage Revenue from new Products, services… Revenue/Employee Investment(...
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul><ul><li>New Product/Service </li></ul><...
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Application
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Customers and  Markets
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Relationship
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Product and Service Mix
Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Pricing Strategy
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul...
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul...
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul...
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul...
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Asset Utilization </li></ul></ul></ul></ul></ul><ul>...
Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Asset Utilization </li></ul></ul></ul></ul></ul><ul>...
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5032771 Balanced Scorecardfinancial Perspective

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5032771 Balanced Scorecardfinancial Perspective

  1. 1. Measuring Business Strategy Through Balance Scorecard
  2. 2. Organization Using balance scorecard 2 tasks Building Scorecard Using Scorecard Organization Organization Organization
  3. 3. Building Scorecard Financial Customer Internal Learning Return on Investment, Economic value Added Satisfaction, Retention, Market and Account Share Quality, Response time, Cost New Product Employee Satisfaction & Information System Perspectives Generic Measures
  4. 4. Financial Perspective
  5. 5. Linking Financial Objectives to Business Unit Strategy 3 Stages Growth Sustain Harvest
  6. 6. Growth <ul><li>Early stage of life cycle </li></ul><ul><li>Products having Growth Potential </li></ul><ul><li>Committing Resources </li></ul><ul><li>Expanding production facilities </li></ul><ul><li>Operating capabilities </li></ul><ul><li>Investing in systems </li></ul><ul><li>Investing in Infrastructure </li></ul><ul><li>Investing in distribution network </li></ul><ul><li>More cash outflow </li></ul><ul><li>Financial Objective-%age </li></ul><ul><li>sales Growth </li></ul><ul><li>customer groups </li></ul>
  7. 7. Sustain Stage <ul><li>Attract investments </li></ul><ul><li>Required extra return </li></ul><ul><li>Maintain existing markets </li></ul><ul><li>Growth is expected </li></ul><ul><li>Enhancing improvements </li></ul><ul><li>Profitability </li></ul><ul><li>Return on Investment </li></ul><ul><li>Economic Value Added </li></ul>
  8. 8. Harvest Stage Maturity phase Enough to maintain equipments No expansion New invest with Short Pay Back Maximize Cash flow Reduction in WC Requirements
  9. 9. Strategic Theme for the Financial Perspective Growth Sustain Harvest <ul><li>Revenue Growth Mix </li></ul><ul><li>Cost Reduction/Productivity </li></ul><ul><li>improvement </li></ul><ul><li>Assets Utilization/Investment Strategy </li></ul>
  10. 10. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul><ul><li>Sales Growth </li></ul><ul><li>Market Share </li></ul><ul><li>Revenue From New Products </li></ul><ul><li>Services & </li></ul><ul><li>Customers </li></ul>
  11. 11. Strategic Theme Sales Growth rate by Segment, Percentage Revenue from new Products, services… Revenue/Employee Investment(% Of Sales) R & D (% of Sales) Share of Targeted Customers Cross Selling % Revenue from new Application Customer & Product line Profitability Customer & Product line Profitability % Unprofitable Customers Cost versus Competitors Cost rates Indirect Expenses ( % of Sales) WC Ratios (Cash to Cash Cycle) ROCE Assets Utilization Rates Unit Costs (Per unit of output Per transaction) Payback Throughput Revenue Growth And Mix Cost Reduction Productivity Improvement Asset Utilization Business Unit Strategy Growth Sustain Harvest
  12. 12. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul><ul><li>New Product/Service </li></ul><ul><li>% Revenue Increase </li></ul>
  13. 13. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Application
  14. 14. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Customers and Markets
  15. 15. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Relationship
  16. 16. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Product and Service Mix
  17. 17. Strategic Theme for the Financial Perspective <ul><li>Revenue Growth Mix </li></ul>New Pricing Strategy
  18. 18. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Improvement </li></ul></ul></ul></ul></ul>Increase Revenue Productivity
  19. 19. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Improvement </li></ul></ul></ul></ul></ul>Reduce Unit Costs
  20. 20. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Improvement </li></ul></ul></ul></ul></ul>Improve Channel Mix
  21. 21. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Cost Reduction/Productivity </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Improvement </li></ul></ul></ul></ul></ul>Reduce Operating Expenses
  22. 22. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Asset Utilization </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Investment </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Strategy </li></ul></ul></ul></ul></ul>Cash to Cash Cycle
  23. 23. Strategic Theme for the Financial Perspective <ul><ul><ul><ul><ul><li>Asset Utilization </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Investment </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Strategy </li></ul></ul></ul></ul></ul>Improve Asset Utilization
  24. 24. Questions

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