3. Balanssoitu tuloskortti ja arvon drivers Flashcards
Kerro, mitkä ovat THREE TYPES OF SCORECARDS?
- Key Performance Indicator (KPI) Scorecards
- Strategy Scorecards
- Stakeholder Scorecards
Kerro, mitkä ovat THREE TYPES OF SCORECARDS?
- Key Performance Indicator (KPI) Scorecards
- Strategy Scorecards
- Stakeholder Scorecards
What is the Content of a good strategy statement?
- Content of a good strategy statement:
– Objective
– Scope
– Advantage- Value proposition
- Internal organization
What is STRATEGY?
Strategy is a general plan to achieve one or more long-term or overall goals under conditions of uncertainty
Mikä on STRATEGY MAP?
A strategy map is a diagram that shows your organization’s strategy on a single page.
It’s great for quickly communicating big-picture objectives to everyone in the company.
Lisää liittyen STRATEGY MAP?
- Strategy map is a visual framework for the corporate objectives within those four areas of balanced scorecard.
- There are many definitions and versions of strategy maps around
- Concepts of leading and lagging indicators
- It is a simplification, providing focus
- Similar logic can be applied in every level in an organization
Strategy map template uses the same four factors as balanced scorecard:
- FINANCIAL
- CUSTOMER
- INTERNAL PROCESSES
- LEARNING ANF GROWTH PERSPECTIVES
Mikä on BALANCED SCORECARD?
Balanced scorecard = is a strategy perfromance management tool, a report, which measures company’s performance from four perspectives:
1. financial
2. customer
3. internal processes
4. learning and growth
Benefits of strategy maps?
Benefits of strategy maps:
1. Strategy maps give employees a clear line of sight into how their jobs are linked to the overall objectives of the organization, enabling them to work in a coordinated, collaborative fashion toward the company’s desired goals.
2. Strategy maps can depict objectives for revenue growth
3. Strategy maps show the cause-and-effect links by which specific improvements create desired outcomes—for example, how enhanced employee capabilities will increase retention of customers and thus increase a company’s revenues.
4. Strategy maps show how an organization will convert its initiatives and resources—including intangible assets such as corporate culture and employee knowledge—into tangible outcomes.
Measurement in strategy maps
- Define measures for each box in a strategy map
- Strategy Scorecard should not contain everything which is important for you, it should contain issues that are crucial for you to achieve competitive advantage
- Strategy Scorecard doesn’t prevent monitoring and measuring other important issues
LINKING SCORECARDS
- Scorecards between levels may be linked directly or logically
- Direct linking means that measures at top level scorecard are summed up from the lower level scorecards
- Logical linking means that lower level identifies which measures at above level scorecard they can have an influence on
- Those measures serve as strategic objectives for the lower level
- Following cause-end effect reasoning the rest of the measures are identified
- Recall that BSC was originally a construct for SBU level
- If derived using logical linking, there is no need to stick with certain perspectives at all levels. This may save a lot of effort and money in measurement
- Measures close to action tend to be more often non- financial
- Note: Linking returns to a question of how accountability, authority, and autonomy are delegated within the organization
TRANSLATING STRATEGY INTO ACTION
- Clarifying strategy and gaining consensus
- Linking strategy and measures (leading indicators!)
- Targets for measures and accountability
- Communicating strategy
- measures and strategy map will communicate what is important
- Identifying and executing projects, programs, mergers & acquisitions, investments, etc.
DESIGNING MANAGEMENT (CONTROL) SYSTEMS TO TRANSLATE STRATEGY INTO ACTION
- Management systems and performance management consist of many different components – management by objectives only part of the picture
- Requires measurement of both outcomes (lagging indicators) and means to outcomes, i.e. strategies (leading indicators)
- Strategy needs to be translated to measures in all levels of an organization – linking crucial
- Right set of measures is not enough – targets should be set, people should be held accountable for achieving the targets
Miksi ne loi Balanced scorecard?
Exclusive reliance on financial measures in a management system is insufficient. Financial measures report on the outcomes from past actions. Exclusive reliance on financial indicators could promote behavior that sacrifices long-term value creation for short-term performance. The Balanced Scorecard supplements these with measures on the drivers, the lead indicators, of future financial performance.
Several factors prevent valid valuation of intangihle assets on balance sheets.
a) First, the value from intangible assets is indirect. The complex linkages make it difficult, if not impossible, to place a financial value on an asset such as workforce capabilities or employee morale, much less to measure period-to-period changes in that financial value.
b) Second, the value from intangible assets depends on organizational context and strategy.
c) Intangible assets seldom have value by themselves. Generally, they must be bundled with other intangible and tangible assets to create value. For example, a new growth- oriented sales strategy could require new knowledge about customers, new training for sales employees. The value does not reside in any individual intangible asset. It arises from creating the entire set of assets along with a strategy that links them together.
