Ch10 Strategic Process - Performance Management

Question 1

Performance management
- a form of strategic control that addresses risks that threaten achievement of strategies

Answer 1

• identify key success factors (outcomes must be achieved)
• identify key performance indicators (goals and expectations)
• develop a method to track progress (leading / lagging indicators)
• determine an effective intervention mechanism

Question 2

Analytical tools to identify KSFs

Answer 2

1. VRINE framework - identify resources / capabilities leading to sustainable competitive advantage (KSFs / CSFs)
2. Value chain analysis (primary / supportive activities - profit margin) - highlights internal activities to identify KSFs / CSFs
3. Balanced scorecard - balanced evaluation between bottom line and important values

Question 3

VRINE analysis

Answer 3

Valuable - save costs, increase prices?

Rare - only few possess the resource or capability.

Inimitable / non-substitutable - easily copied or
substituted by other compa
nies.

Exploitable - ability to take advantage of the resource or capability.

Question 4

BSC - balanced scorecard perspective

Answer 4

1. Financial - owners and investors
2. Customer - customers and market
3. Internal process - excel at execution
4. Learning and growing - skills and capabilities must be developed and created.

Question 5

KPIs - Key performance indicators
Identified KFSs / CFSs

SMART criteria

Answer 5

Specific: measures directly related to the success of strategy

Measurable: quantify or indicate direction

Attainable: reasonable and can be reached

Realistic: useful for gauging performance

Timely: timely so results can be acted upon

Question 6

KPIs - leading and lagging