Chapter 2

Question 1

Balanced Scorecard (BSC)

Answer 1

a comprehensive performance measurement tool that helps firms implement strategy by aligning performance measures to critical success factors (CFs). It tracks the achievement of strategic goals and motivates managers and employees to work towards those goals.

Question 2

Strategy Map

Answer 2

cause-and-effect diagram of the relationships among the BSC perspectives. Managers use it to show how the achievement of goals in each perspective affect the achievement of goals in other perspectives, and finally the overall success of the firm.

Question 3

SWOT Analysis

Answer 3

systematic procedure for identifying a firm’s critical success factors: its internal strengths and weaknesses and its external opportunities and threats.

Question 4

Core competencies

Answer 4

Skills or competencies that the firm employs especially well

Question 5

Critical success factors

Answer 5

aka value propositions. represents the critical process in the firm that delivers value to the customer.

Question 6

Value-chain analysis

Answer 6

strategic analysis tool used to better understand the firm’s competitive advantage; to identify where value to customers can be increased or costs reduced; and to better understand the firm’s linkages with suppliers, customers, and other firms in the industry.

Question 7

sustainability

Answer 7

the balancing of short- and long-term goals in all three dimensions of performance. The environmental dimension refers to the impact of the firm’s operations on the environment. Social performance relates to the health and safety of employees and the community in which the firm operates. Governance relates to matters of management structure, shareholder rights, and the ethical leadership of the firm.