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The Balanced Scorecard

The Balanced Scorecard. Chapter 9. Achieving Success in the Information Era. To achieve success in the information era, companies need more than prudent investment in physical assets and excellent management of financial assets and liabilities

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The Balanced Scorecard

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  1. The Balanced Scorecard Chapter 9  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  2. Achieving Success in theInformation Era • To achieve success in the information era, companies need more than prudent investment in physical assets and excellent management of financial assets and liabilities • Companies mobilize and create value from their intangible assets as well as their physical and financial ones  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  3. Intangible Assets • An organization’s intangible assets include: • Loyal and profitable customer relationships • High-quality processes • Innovative products and services • Employee skills and motivation • Databases and information systems • Some academic scholars and practitioners have tried to expand the financial model to incorporate the valuation of intangible assets on a company’s balance sheet  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  4. Measuring Intangible Assets • Difficulties in placing a reliable financial value on intangible assets have prevented them from being recognized on a company’s balance sheet • Likely to continue to be the case • Yet these assets are critical for success • Managers understand that if “you can’t measure it, you can’t manage it” • Many managers have searched for a system that would help them measure and manage the performance of their intangible, knowledge-based assets  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  5. The Balanced Scorecard • The Balanced Scorecard (BSC) provides a system for measuring and managing all aspects of a company’s performance • The scorecard balances traditional financial measures of success, such as profits and return on capital, with non-financial measures of the drivers of future financial performance • The Balanced Scorecard measures organizational performance across different perspectives • Derived from the organization’s vision and strategy  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  6. Perspectives • Four different but linked perspectives are derived from the organization’s strategy • Financial: How is success measured by shareholders? • Customer: How do we create value for customers? • Internal: At what internal processes must we excel to satisfy customers and shareholders? • Learning & Growth: What employee capabilities, information systems, and organizational climate do we need in order to continually improve internal processes and customer relationships?  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  7. Balanced Measurements • Rather than rely on an measurement system that reports only on financial results, the BSC enables companies to: • Track financial results • Simultaneously monitor how they are building the capabilities for future growth and profitability • With customers • With their internal processes • With their employees and systems  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  8. Connecting the Four Perspectives • A strategy map provides a visual representation of the linkages in the four perspectives of the BSC FinancialPerspective Return on Investment CustomerPerspective Customer Loyalty On-Time Delivery Internal Perspective Process Quality Cycle Time Learning & Growth Perspective Employees’ Process Improvement Skills  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  9. Connections (1 of 3) • Return on investment (ROI) is a widely recognized measure of financial success • Accordingly, ROI is included on the scorecard • But what drives ROI? • Repeated and expanded sales from existing customers, the result of a high degree of loyalty among existing customers, could be one driver of this financial measure • Customer loyalty is included on the scorecard because it is expected to have a strong influence on ROI • But how will the organization achieve customer loyalty?  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  10. Connections (2 of 3) • Analysis of customer preferences may reveal that on-time delivery (OTD) of orders is highly valued by customers • Improved on-time delivery performance is expected to lead to higher customer loyalty • So both customer loyalty and OTD are incorporated into the scorecard’s Customer perspective • But how will the organization improve OTD? • The company must excel at internal processes to achieve exceptional OTD  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  11. Connections (3 of 3) • Short cycle times and high-quality production processes are two drivers of on-time delivery • These two parameters are measured in the Internal perspective • But how do organizations improve the quality and reduce the cycle times of their production processes? • The company must have skilled production workers, well-trained in process improvement techniques • A measure of employees’ skill and capabilities in process improvement is, therefore, used in the Learning & Growth perspective  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  12. Strategy and the BSC • A properly constructed Balanced Scorecard tells the story of the business unit's strategy • It identifies and makes explicit the hypotheses about the cause and effect relationships between: • Outcome measures in the Financial and Customer perspectives • E.G., ROI and customer loyalty • and the performance drivers of those outcomes that are measured in the Internal and Learning & Growth perspectives • Such as zero defect processes, short cycle times, and skilled, motivated employees  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  13. Objectives (1 of 2) • Are concise statements that articulate what the organization hopes to accomplish • Best stated as action phrases • May include the means and the desired results • Tell the story of the strategy through the cause-and-effect relationships in each of the four balanced scorecard perspectives • The company’s balanced scorecard would typically contain an extensive (3-5 sentence) description of each objective • The following examples are abbreviated versions  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  14. Objectives (2 of 2) • Typical objectives found in each of the four BSC perspectives include: • Increase revenues through expanded sales to existing customers (Financial perspective) • Become service oriented (Customer perspective) • Achieve excellence in order fulfillment through continuous process improvements (Internal perspective) • Align employee incentives and rewards with the strategy (Learning & Growth perspective) • Even descriptions of a paragraph are insufficient to give complete clarity to the objective • Measures describe how success in achieving an objective will be determined  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  15. Measures • Provide specificity and reduce the ambiguity that is inherent in word statements • Specifying exactly how an objective is measured will give employees a clear focus for their improvement efforts • Once the objectives have been translated into measures, managers select targets for each measure  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  16. Targets and Initiatives • Targets establish the level of performance or rate of improvement required for a measure • Should be set to represent excellent performance • Should, if achieved, place the company as one of the best performers in its industry • Even more important would be to choose targets that create distinctive value for customers and shareholders • Finally, managers identify initiatives • The short-term programs and action plans that will help achieve the stretch targets established for its measures  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  17. Vision and Mission • Before determining the objectives and measures, an organization should already have a vision and mission statement • And a general idea of its strategy • These high-level statements can then be translated into detailed objectives and measures • The exact definitions of vision and mission can vary, but the following examples should provide helpful guidelines  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  18. Vision • A concise statement that defines the mid to long-term (3 - 10 year) goals of the organization • The vision should be external and market-oriented and should express, often in colorful or “visionary” terms, how the organization wants to be perceived by the world: “The City of Charlotte will be a model of excellence that puts its citizens first. Skilled, motivated employees will be known for providing quality and value in all areas of service. We will be a platform for vital economic activity that gives Charlotte a competitive edge in the marketplace. We will partner with citizens and businesses to make Charlotte a community of choice for living, working and leisure activities”  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  19. Mission Statement • A concise, internally-focused statement of how the organization expects to compete and deliver value to customers • It often states the reason for the organization’s existence, the basic purpose towards which its activities are directed, and the values that guide employee’s activities: “The mission of the City of Charlotte is to ensure the delivery of quality public services that promote the safety, health and quality of life of its citizens. We will identify and respond to community needs and focus on the customer through: • Creating and maintaining effective partnerships • Attracting and retaining skilled motivated employees • Using strategic business planning”  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  20. Putting Vision in Action • The Vision and Mission set the general direction for the organization • They are intended to help shareholders, customers, and employees understand what the company is about and what it intends to achieve • But these statements are far too vague to guide day-to-day actions and resource allocation decisions • Companies start to make the statements operational when they define a strategy of how the vision and mission will be achieved  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  21. What is Strategy? • The strategy literature is uncommonly diverse • Different scholars and practitioners have very different definitions or even understanding about what strategy is and how it should be defined • For purpose of this chapter, we adopt the general framework articulated by Michael Porter, one of the founders and still an outstanding leader in the field of the strategy  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  22. Strategy According to Porter • Porter argues that strategy is about selecting the set of activities in which an organization will excel to create a sustainable difference in the marketplace • The sustainable difference may be to: • Deliver greater value to customers than competitors • Provide comparable value at a lower price than competitors • He states, “Differentiation arises from both the choice of activities and how they are performed”  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  23. Building theBalanced Scorecard • With this background on establishing high-level direction for the organization, we now develop the role for the BSC to provide needed specificity that makes vision, mission and strategy statements meaningful and actionable for employees • Starting with the Financial perspective of the scorecard and working successively through the Customer, Internal, and Learning & Growth perspectives  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  24. Financial Perspective (1 of 2) • The ultimate objective for profit-maximizing companies • Financial performance measures indicate whether the company's strategy, implementation, and execution are contributing to bottom-line improvement • Financial objectives typically relate to profitability • For example, operating income and ROI • A company’s financial performance can be improved in two ways: • Revenue growth and increased productivity  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  25. Financial Perspective (2 of 2) • Companies generate revenue growth by: • Selling new products • Selling to new customers • Selling in new markets • Increased productivity occurs by: • Lowering direct and indirect expenses • Enabling a company to produce the same quantity of outputs while spending less on people, materials, energy, and supplies • Utilizing their financial and physical assets more efficiently • Reducing the working and fixed capital needed to support a given level of business  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  26. Customer Perspective (1 of 3) • In this perspective, managers identify the targeted customer segments in which the business unit competes and the measures of the business unit's performance in these targeted segments • The Customer perspective typically includes several common measures of the successful outcomes from a well-formulated and implemented strategy: • Customer satisfaction • Customer retention • Customer acquisition • Customer profitability • Market share • Account share • Virtually all organizations try to improve these common customer measures so these measures by themselves do not describe a strategy  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  27. Customer Perspective (2 of 3) • A strategy identifies specific segments targeted for growth and profitability • E.g., Southwest Airlines, targets price-sensitive customers while Neiman-Marcus targets customers willing to spend their high disposable incomes • Companies must also identify the objectives and measures for the value proposition it offers customers  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  28. Customer Perspective (3 of 3) • The value proposition is the unique mix of product, price, service, relationship, and image offered to the targeted customers • Defines the company’s strategy • Should communicate what the company expects to do for its customers better or differently from its competitors • Value propositions used successfully by different companies include: • “Best buy” or lowest total cost • Product innovation and leadership • Complete customer solutions  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  29. Internal Perspective (1 of 3) • Once an organization has a clear picture of its financial objectives and customer objectives, it should determine the means by which it will: • Produce and deliver the value proposition for customers • Achieve the productivity improvements for the financial objectives • The Internal perspective identifies the critical processes at which the organization must excel to achieve its customer, revenue growth, and profitability objectives  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  30. Internal Perspective (2 of 3) • Organizations perform many different processes, which may be classified into four groupings: • Operating processes • The basic, day-to-day processes by which companies produce their existing products and services and deliver them to customers • Customer management processes • Processes by which companies expand and deepen relationships with targeted customers  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  31. Internal Perspective (3 of 3) • Innovation processes • Processes by which companies develop new products, processes, and services, often enabling the company to penetrate new markets and customer segments • Regulatory and social processes • Processes by which companies ensure that they meet or exceed regulations on business practices • Managers should identify which of the process objectives and measures are the most important for their strategy • Need to follow a “balanced” strategy and invest in improving processes in all four groups  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  32. Learning & Growth Perspective (1 of 3) • Identifies objectives for the people, systems, and organizational alignment that create long-term growth and improvement • Managers define the employee capabilities, skills, technology, and organizational alignment that will contribute to improving performance in the measures selected in the first three perspectives • They learn where they must invest to improve the skills of their employees, enhance information technology and systems, and align people to the company’s objectives  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  33. Learning & Growth Perspective (2 of 3) • The Learning & Growth perspective of the scorecard identifies how executives mobilize their intangible assets (human, information, and organization) to drive improvement in the internal processes most important for implementing their strategy • In general, for companies to develop their Learning & Growth objectives and measures, managers examine each of the processes they selected in the Internal perspective  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  34. Learning & Growth Perspective (3 of 3) • They then determine the factors that enable that process to be performed in an outstanding manner so that it can contribute to the success of the company’s strategy: • The employee capabilities, knowledge, and skills • The information systems and databases • Employee culture, alignment, and knowledge-sharing  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  35. KPI Scorecards • Some organizations identify key performance indicators (KPIs) and classify them into the four BSC perspectives • KPIs typically are common measures, such as customer satisfaction, quality, cost, employee satisfaction, and morale • They are worth striving to achieve but do not reflect a company’s strategy • Companies may expand their compensation system to reward executives for a broader set of performance than simply short-term financial results based on KPIs • Not as powerful as selecting measures that can be linked back to the strategy and that will drive successful strategy implementation  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  36. BSC in Nonprofits and Government Organizations • The BSC is especially well-suited for nonprofit and government organizations (NPGOs) • Their success has to be measured by their effectiveness in providing benefits to constituents • NPGOs cannot be measured primarily by their financial performance • Since nonfinancial measures can assess performance with constituents, the BSC provides the natural performance management system for NPGOs  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  37. NPGOs and Strategy • Many NPGOs encountered difficulties in developing their initial BSC, finding that they didn’t have a clear strategy • NPGO’s thinking has to shift from what it plans to do to what it intends to accomplish • Many NPGOs place their mission objective at the top of their scorecard and strategy map • Cannot use the standard BSC architecture where financial objectives are the ultimate, high-level outcomes to be achieved • Also expand the definition of who is the customer  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  38. Using BSC to Implement Strategy • BSC was originally developed to improve performance measurement, but organizations learned that measurement has consequences far beyond reporting on the past • Measurement creates focus for the future • The BSC concept evolved during the 1990’s from a performance measurement system to a new strategic management system • BSC focused the entire organization on strategy implementation  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  39. 5 Principles for BecomingStrategy-Focused (1 of 3) • Organizations achieved their strategic alignment and focus in different ways, at different paces, and in different sequences, but they generally followed a common set of five principles: • Translate the Strategy to Operational Terms • Executive teams often report great benefits from the process of building the scorecard • Align the Organization to the Strategy • For organizational performance to exceed the sum of its parts, the strategies of diverse, decentralized units must be linked and integrated  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  40. 5 Principles for BecomingStrategy-Focused (2 of 3) • Make Strategy Everyone’s Job • Employees must learn about the strategy and reorient their day-to-day tasks to contribute to the success of that strategy • This is top-down communication about what the organization is attempting to accomplish, leaving to employees the challenge and opportunity to perform their work in new and different ways to help the organization achieve its strategic objectives • Make Strategy a Continual Process  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  41. 5 Principles for BecomingStrategy-Focused (3 of 3) • Mobilize Leadership for Change • The single most important condition for success in becoming truly strategy-focused is ownership and active involvement of the executive team • If those at the top are not energetic leaders of the process, change will not occur and strategy will not be implemented successfully  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  42. Pitfalls (1 of 3) • As with any new technology or management tool, not all BSC implementations have been successful • Several design factors can lead to problems and disappointment when applying the BSC • Too few measures in the scorecard to provide: • A complete picture of the company’s strategy • A balance between desired outcomes and the performance drivers of those outcomes • Too many measures • Attention is diffused, and insufficient attention is given to those few measures that make the greatest impact  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  43. Pitfalls (2 of 3) • The drivers in the Internal and Learning & Growth perspectives don't link to the desired outcomes in the Financial and Customer perspective • E.g., strategy may call for creating innovative solutions for its customers but the measures in the internal perspective focus exclusively on operational improvements • As these design flaws are detected, they can be easily corrected • The biggest threat is a poor organizational process for developing and implementing the scorecard, seen when:  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  44. Pitfalls (3 of 3) • Senior management is not committed, and the BSC project is delegated to middle management • One senior manager builds the scorecard alone • Senior executives feel that only they need to know and understand the strategy, and BSC responsibilities don't filter down • The BSC is treated as a one-time event that requires the perfect scorecard for implementation • BSC is an iterative process • All BSC’s start with some new measures for which no data currently exists • The BSC is treated as a systems project rather than as a management project  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  45. BSC Summary (1 of 2) • BSC integrates measures based on strategy • Retains financial measures of past performance • Also introduces the drivers of future financial performance • The drivers are derived from an explicit and rigorous translation of the organization's strategy into tangible objectives and measures • The new measurement and management system will have its greatest impact when the executive team is leading the transformational processes  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  46. BSC Summary (2 of 2) • The benefits from BSC are realized as the organization integrates its new measurement system into management processes that: • Cascade the strategy to all organizational units • Communicate the strategy to all employees • Align employees’ individual objectives and incentives to successful strategy implementation • Integrate the strategy with ongoing management processes: • Planning, budgeting, reporting, and management meetings  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

  47. If you have any comments or suggestions concerning this PowerPoint presentation, please contact:Terry M. Lease(terry.lease@sonoma.edu)Sonoma State University  2003 Prentice Hall Business Publishing, PowerPoint supplement to Management Accounting, 4rd ed., Atkinson, Kaplan, and Young, prepared by Terry M. Lease, Ph.D., CPA, Sonoma State University

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