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Balanced Scorecard - Financial Metrics

Balanced Scorecard - Financial Metrics

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03/18/2014

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<Company Name> Balanced Scorecard — Financial Metrics

<Date>

List Data:

Objective Type Revenue growth and mix Cost reduction/productivity Asset utilization Market performance

Financial Metrics
Financial Objective Type Revenue growth and mix Measures Sales growth by segment Targets 5% quarterly growth for segment A. Supporting Initiatives Q1 Q2 5.00% Q3 6.00% Q4 5.00% Annual 5.00% Analysis Target achieved

4.00% VP of sales will hire 2 new sales representatives to focus on segment A by January 31.

Revenue growth and mix

Percentage of revenue from new products

15% of annual revenue will come from new product B. 10% of annual revenue will come from new service C. 5% of annual revenue will come from new customer D. Increase wallet share of target account E from 15% to 25% by the end of the year. Increase profitability in customer segment F from 15% to 20% by the end of the year. Increase profitability of product line G from 20% to 25% by the end of the year. Reduce the percentage of unprofitable customers from 10% to 0% by the end of the year. Increase revenue per employee from $110,000 to $115,000 by the end of the year. Increase cost reduction rate by 2% by the end of the year. Reduce general and administrative expenses as a percentage of sales from 15% to 12%, to meet competitors' expense ratios. Reduce unit cost per procurement transaction from $0.75/unit to $.50/unit by the end of the year.

Revenue growth and mix

Percentage of revenue from new services

Revenue growth and mix

Percentage of revenue from new customers

Revenue growth and mix

Share of wallet from target accounts

Revenue growth and mix

Customer profitability

Revenue growth and mix

Product profitability

Revenue growth and mix

Percentage of unprofitable customers

Cost reduction/productivity

Revenue per employee

Cost reduction/productivity

Cost reduction rate

Cost reduction/productivity

Indirect expenses as a cost of sales

Cost reduction/productivity

Unit cost per transaction

Asset utilization

Research and development as a percentage of sales Increase research and development as a percentage of sales from 15% to 20% by the end of the year. Working capital ratio Increase our working capital from $1,000,000 to $1,200,000 by the end of the year. Decrease average payback time on capital equipment purchases from 9 months to 7 months by the end of the year. Increase throughput from 20 widgets per day to 25 widgets per day by the end of the year. Improve economic value added by 10% by the end of the year. Grow stock price by 25% by the end of the year.

Asset utilization

Asset utilization

Payback

Asset utilization

Throughput

Market performance

Economic value added

Market performance

Stock price growth

<Company Name> Balanced Scorecard — Customer Metrics
<Date>

List Data:

Objective Type Market share Customer acquisition Customer retention Customer profitability

Customer Metrics
Customer Objective Type Market share Measures Market share by dollars Targets Increase market share from 15% to 25% by the end of the year in market B. Increase the number of units sold to market A from 20,000 to 25,000 by the end of the year. Contract with 75% of all customers within target vertical C. Increase number of proposals from 15% to 20% by the end of the year. Increase proposal win rate from 15% to 20% by the end of the year. Reduce the number of unqualified leads by 25% by the end of the year. Retain 100% of all named accounts throughout the fiscal year. Reduce percentage of unprofitable customers from 10% to 0% by the end of the year. Increase overall customer profitability from 25% to 30% by the end of the year. Increase customer satisfaction (as measured by external survey) so that 75% of all customers are "somewhat" or "very" satisfied. Reduce the number of unresolved issues by 50% by the end of the year. Reduce the number of returns by 75% by the end of the year. Reduce percentage of out-of-stock items by 60% by the end of year. Supporting Initiatives Q1 Q2 18.00% Q3 21.00% Q4 26.00% Annual 26.00% Analysis Target exceeded

To increase overall sales, launch 15.00% marketing campaign that is targeted to market A in March.

Market share

Market share by units

Market share

Percentage of key customers within target market

Customer acquisition

Proposal rate

Customer acquisition

Win rate

Customer acquisition

Number of unqualified leads

Customer retention

Key account retention

Customer profitability

Percentage of unprofitable customers

Customer profitability

Customer profitability percentage

Customer satisfaction

Customer satisfaction percentage

Customer satisfaction

Number of unresolved issues

Customer satisfaction

Number of customer returns

Customer satisfaction

Out-of-stock percentage

<Company Name> Balanced Scorecard — Internal Business Process Metrics
<Date>

List Data:

Objective Type Innovation Operations Post-sales service

Internal Business Process Metrics
Internal Objective Type Innovation Measures Percentage of sales from new products Targets 5% of revenues will come from new products A and B. 10% of annual revenue will come from proprietary product C. 8 new products will be introduced this year, compared to 5–7 from primary competitor. A new manufacturing technique will be developed that will improve water consumption for manufacturing process. The next generation of product D will be developed within 18 months. New products will be brought to market within 6 months of design inception. New products will break even within one year after product launch. Defects will be reduced from 3 in every 1,000 to 1 in every 1,000 by June. Project overruns will be reduced from 75% to 20% by the end of the year. Throughput will be maintained at the same level with 10% fewer resources. Machine E's capacity will be upgraded to handle 20,000 units per hour by March. Purchase price variance on raw materials will decrease by 50% by June. Manufacturing process cycle time will be reduced from 60 days to 55 days by Q3. The cost to produce one unit will decrease from $35/unit to $32/unit by the end of the year. Warranty costs will be reduced by 50% by the end of the year. Warranty issues will by resolved within 20 days by the end of Q3. Customer collections will be received within 35 days by April 30. Supporting Initiatives Q1 Q2 2.00% Q3 4.00% Q4 5.00% Annual 5.00% Analysis Target achieved

New markets team will drive sales of 1.00% new products through indirect channel.

Innovation

Percentage of sales from proprietary products

Innovation

New product introductions versus competitors

Innovation

Process capability

Innovation

Time to develop next generation of products

Innovation

Time to market for new products

Innovation

For new products, time to breakeven point

Operations

Product quality

Operations

Service quality

Operations

Labor efficiency

Operations

Machine efficiency

Operations

Purchase price variance

Operations

Process cycle time

Operations

Process cost

Post-sales service

Warranty and repair costs

Post-sales service

Cycle time for warranty and repair issues

Post-sales service

Payment processing cycle time

<Company Name> Balanced Scorecard — Learning and Growth Metrics
<Date>

List Data:

Objective Type Employee retention Employee satisfaction Employee productivity

Learning and Growth Metrics
Learning Objective Type Employee retention Measures Annual turnover percentage Targets Supporting Initiatives Q1 Q2 18.00% Q3 17.00% Q4 16.00% Annual 16.00% Analysis Progress made; target not achieved

Reduce overall turnover from 18% to 15% by end VP of HR will implement new benefits 19.00% of year. and total rewards strategy in Q1. Reduce voluntary turnover percentage from 9% to 5% by the end of the year. Reduce turnover of key personnel from 25% to 5% by the end of the year. Based on employee survey, ensure that 75% of employees feel involved with key decisions by the end of the year. Based on employee survey, ensure that 90% of top-rated employees feel they receive positive recognition for their achievements. Based on employee survey, ensure that 100% of employees know where to find and how to access information critical to their jobs. Based on employee survey, ensure that 80% of employees feel that creativity is encouraged and that 100% of research team feels encouraged. Based on employee survey, ensure that 75% of employees feel that they receive acceptable staff and administrative support. Based on employee survey, ensure that 75% of all employees are satisfied working with the company. Increase revenue per employee from $120,000 to $125,000 by the end of the year. Increase training budget per employee from $3,000 to $5,000 annually. For key positions, ensure competency fit is 100% by the end of the year.

Employee retention

Voluntary annual turnover percentage

Employee retention

Key personnel turnover percentage

Employee satisfaction

Involvement with decisions

Employee satisfaction

Recognition

Employee satisfaction

Access to information

Employee satisfaction

Encouragement to be creative

Employee satisfaction

Support from staff functions

Employee satisfaction

Overall satisfaction with company

Employee productivity

Revenue per employee

Employee productivity

Training budget per employee

Employee productivity

Competency alignment

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