1 - Introduction

Question 1

What percentage of a company’s value do intangible assets account for?

Answer 1

More than 75 percent

Intangible assets are not measured by a company’s financial system.

Question 2

What is the primary focus of Gray-Syracuse’s new training program?

Answer 2

Rapidly upgrade competencies of thirty assemblypersons

This program aims to reduce rework and improve quality in the production process.

Question 3

What major opportunity did senior management at Gray-Syracuse identify?

Answer 3

The front end of the production process

This opportunity was linked to reducing rework and improving quality.

Question 4

What is the Balanced Scorecard (BSC) used for?

Answer 4

To create a measurement system that focuses on an organization’s strategy

It aims to achieve future sustainable value.

Question 5

What does the strategy of an organization describe?

Answer 5

How it intends to create value for shareholders, customers, and citizens

This is essential for aligning intangible assets.

Question 6

True or False: Most companies succeed in implementing their strategies.

Answer 6

False

Studies show that only a small percentage achieve their strategic targets.

Question 7

What does the customer perspective in the BSC define?

Answer 7

The value proposition for targeted customer segments

It includes lagging outcome indicators like satisfaction and retention.

Question 8

Fill in the blank: The performance of _______ processes is a leading indicator of subsequent improvements in customer and financial outcomes.

Answer 8

Internal

Internal processes are crucial for delivering customer value.

Question 9

What are the four clusters of internal processes according to the taxonomy introduced in the book?

Answer 9

• Operations management
• Customer management
• Innovation
• Regulatory and social

Each cluster has subprocesses that create value.

Question 10

What is the ultimate definition of success for public and nonprofit organizations?

Answer 10

Their performance in achieving their mission

This differs from the financial perspective used in the private sector.

Question 11

What does a strategy map provide?

Answer 11

A visual representation of cause-and-effect relationships among strategy components

It helps in describing and implementing an organization’s strategy.

Question 12

What is a key principle of strategy according to the document?

Answer 12

Strategy balances contradictory forces

Long-term growth often conflicts with short-term financial performance.

Question 13

What does the term ‘differentiated customer value proposition’ refer to?

Answer 13

A clear articulation of targeted customer segments and the value needed to satisfy them

This is central to the strategy.

Question 14

What percentage of large companies achieved at least a 5.5% real cumulative annual growth rate in earnings from 1988 to 1998?

Answer 14

One out of eight

This highlights the difficulty in achieving strategic targets.

Question 15

What is the main goal of the Balanced Scorecard?

Answer 15

To link management systems to the strategy

This allows organizations to implement new strategies effectively.

Question 16

Fill in the blank: Enhancing and aligning _______ assets leads to improved process performance.

Answer 16

Intangible

Intangible assets are crucial for value creation.

Question 17

What is one of the observed customer strategies organizations use?

Answer 17

• Low total cost
• Product leadership
• Complete customer solutions
• System lock-in

These strategies define attributes necessary for customer satisfaction.

Question 18

What are the four clusters of internal processes classified in the taxonomy introduced in Part II?

Answer 18

• Operations management
• Customer management
• Innovation
• Regulatory and social

Each cluster contributes to enhancing productivity and maintaining the organization’s franchise to operate.

Question 19

What are the critical few processes referred to in strategic management?

Answer 19

Strategic themes

These themes are essential for creating and delivering the differentiating customer value proposition.

Question 20

What typically delivers short-term results in strategic management?

Answer 20

Improvements in operational processes

These improvements generally result in cost savings and quality enhancements.

Question 21

What is the expected time frame for benefits from enhanced customer relationship management to phase in?

Answer 21

Six to twelve months

This is after the initial improvement in customer management processes.

Question 22

What are the three categories of intangible assets according to the Balanced Scorecard?

Answer 22

• Human capital
• Information capital
• Organization capital

Each category plays a role in implementing the organization’s strategy.

Question 23

True or False: The value of intangible assets can be measured separately or independently.

Answer 23

False

The value derives from their ability to help the organization implement its strategy.

Question 24

What are the three targeted approaches for aligning intangible assets to strategy?

Answer 24

• Strategic job families that align human capital to the strategic themes
• Strategic IT portfolio that aligns information capital to the strategic themes
• Organization change agenda that integrates and aligns organization capital

These approaches ensure high organization readiness.

Question 25

Fill in the blank: Organization readiness is high when _______.

Answer 25

Human capital capabilities are aligned closely to the strategic themes ## Footnote This alignment enhances the organization’s ability to mobilize and sustain change.

Question 26

What is the goal of the strategy map template in the context of the organization’s strategy?

Answer 26

To describe how intangible assets drive performance enhancements ## Footnote This helps deliver value to customers, shareholders, and communities.

Question 27

What does Chapter 2 of the book provide?

Answer 27

A primer on strategy maps ## Footnote It explains the strategy map template and selection of objectives in the four Balanced Scorecard perspectives.

Question 28

What is the mission of the Bank of Tokyo-Mitsubishi?

Answer 28

To be the number one foreign wholesale bank in the Americas ## Footnote This mission guides the bank's strategic initiatives and operations.

Question 29

What approach did BTMHQA adopt to implement a common strategic platform?

Answer 29

The Balanced Scorecard ## Footnote This approach helped to articulate strategies and establish a risk-control framework.

Question 30

True or False: Japanese organizations historically relied on articulated strategies to compete successfully.

Answer 30

False ## Footnote Traditionally, they operated on implicit understandings due to cultural homogeneity.

Question 31

What is a key challenge BTMHQA faced in unifying its workforce?

Answer 31

Cultural differences ## Footnote These differences were amplified by traditional Japanese business practices and leadership structures.

Question 32

What was a significant change in BTMHQA's governance approach in 2001?

Answer 32

Adoption of the Balanced Scorecard for corporate governance ## Footnote This was in response to the regulatory environment and the need for clearer strategic communication.

Question 33

What type of performance system did BTMHQA aim to implement using the Balanced Scorecard?

Answer 33

A pay-for-performance system ## Footnote This system was intended to create coherence and synergy across business units.

Question 34

What was the first step in BTM's strategy development?

Answer 34

An up approach involving a task force of representatives from each business unit to create a worksheet

Question 35

What is the purpose of the Strategy Map in BTM's Balanced Scorecard?

Answer 35

To define broad categories and themes within the four perspectives of the Balanced Scorecard for aligning objectives

Question 36

What are the three types of objectives classified in BTM's Balanced Scorecard?

Answer 36

* Common * Shared * Unique

Question 37

What is an example of a Common objective in BTM's Balanced Scorecard?

Answer 37

'Enhance cost efficiency' in the financial perspective

Question 38

What defines a Shared objective in BTM's Balanced Scorecard?

Answer 38

An interdivisional objective that requires cooperation between units to achieve specific results

Question 39

What is a Unique objective in BTM's Balanced Scorecard?

Answer 39

An intradivisional objective to be fulfilled independently by a given group

Question 40

What financial goal did GCBU-Americas set?

Answer 40

Maximize net income after credit costs

Question 41

How does GCBU-Americas plan to differentiate its services to customers?

Answer 41

By offering reliable lending capabilities, an extensive global network, and high-quality service

Question 42

What are the four major components of GCBU-Americas' revenue growth strategy?

Answer 42

* Support Americas clients' business in Asia * Deliver customized products through collaboration * Clear customer segmentation * Define risk appetite aligned to business strategy

Question 43

What is the focus of GCBU-Americas in terms of risk management?

Answer 43

Proactive identification and mitigation of risks, especially in Latin America

Question 44

What objectives does GCBU-Americas have regarding human capital?

Answer 44

* Succession planning * Training * Work environment * Pay-for-performance

Question 45

What significant change occurred at BTM after the adoption of strategy maps?

Answer 45

Strategy became 'everyone’s job' and facilitated discussions about performance measurement

Question 46

What is the role of risk managers in BTM's strategy?

Answer 46

To make regular presentations on the metrics in their scorecards

Question 47

What metric measures the percentage of issues identified proactively by BTM's business lines?

Answer 47

'Share of issues' identified through COSO-based self-assessment

Question 48

What is the mission of the American Diabetes Association (ADA)?

Answer 48

'Prevent and cure diabetes and to improve the lives of all people affected by diabetes.'

Question 49

What was ADA's goal by 2007 under CEO John H. Graham IV?

Answer 49

To increase income to $300 million to better support its efforts and programs

Question 50

What strategic approach did ADA use to enhance strategy execution?

Answer 50

The Balanced Scorecard to balance growth with operational efficiency

Question 51

What are the two strategic themes identified by ADA?

Answer 51

* Constituent relationship management * Standardized execution

Question 52

What is a key input for improving the quality of life according to ADA's strategy?

Answer 52

Improving quality of care

Question 53

What is essential for ADA to meet its stakeholder and constituent objectives?

Answer 53

Economic viability through increased net margin growth

Question 54

What is the foundation of ADA's strategy?

Answer 54

Human and organizational enablers

Question 55

What did ADA's executive team find valuable about building the strategy map?

Answer 55

The process of building the map brought discipline and logic to strategic decision making

Question 56

What was the purpose of the leadership team's strategic decision making?

Answer 56

To establish strategic objectives that had not existed before ## Footnote This involved creating a strategic map that guided discussions and decisions.

Question 57

What process was used to reach consensus on the strategic objectives?

Answer 57

Debate and dialogue among the leadership team ## Footnote This facilitated clarity on various organizational aspects.

Question 58

What did the dialogue allow ADA to clarify?

Answer 58

* Stakeholders and constituents * Deliverables * Competitive capability ## Footnote These clarifications were crucial for effective communication.

Question 59

What was the outcome of the strategic decision-making process for ADA?

Answer 59

A clear basis for internal and external communication on objectives and strategy ## Footnote This clarity helped ADA explain its actions.

Question 60

Fill in the blank: The leadership team’s strategic decision making provided a clear basis for _______ and external communication.

Answer 60

[internal]

Question 61

True or False: The strategic objectives on the map were established without any debate.

Answer 61

False ## Footnote The objectives were debated until consensus was reached.

Question 62

Who prepared the case study on ADA's strategic decision-making?

Answer 62

Mario Bognanno and Tom Bognanno ## Footnote They were associated with the Balanced Scorecard Collaborative and ADA.

Question 63

What was one key aspect that ADA was able to explain after the strategic decision-making process?

Answer 63

Why it was doing some things and not others ## Footnote This explanation was facilitated by the clarity gained from the process.