Balanced

Scorecard –
Part 1
Agenda
Introduction
Introduction
These measures must be balanced
between the following measures:
✓ performance driver measures
(i.e., lead indicators of future
financial performance) and
outcome measures (i.e., lagged
indicators of financial
performance)
✓ objective and subjective
measures
✓ external and internal measures
✓ financial and nonfinancial
measures
Definition
The Four
Perspectives
The f inancial
perspective
describes the
economic
consequences of
actions taken in the
other three
perspectives.
The customer
perspective defines the
customer and
market segments in which
the business unit will
compete.

The customer perspective is

the source of the revenue
component for the financial
objectives.

It defines and selects the

customer and market
segments in which the
company chooses to
compete
The internal business
process perspective describes
the internal processes needed to
provide value for customers and
owners.

The internal perspective focuses on

identifying the organization’s core
internal business processes needed
for creating customer and
shareholder value
to achieve the customer and
financial objectives.
 The learning and
This perspective has three major objectives: growth
✓ increase employee capabilities. (infrastructure)
✓ increase motivation, empowerment, and
alignment.
perspective
✓ increase information systems defines the capabilities
capabilities. that an organization
needs to create long-
term growth and
improvement.
Strategy
Translation
Objective
Measure
Target
Initiative
Linking Balancing outcome measures with performance
drivers is essential to linking with the
Performance organization’s strategy.
Measures to Performance drivers make things happen and are
Strategy indicators of how the outcomes are going to be
realized.
 Outcome measures are also important because
Linking they reveal whether the strategy is being
Performance implemented successfully with the desired
Measures to economic consequences.

Strategy A testable strategy can be defined as a set of

linked objectives aimed at an overall goal.
A Testable
Strategy
Example
The
Financial
Perspective
The
Customer
Perspective
The Internal
(Process)
Perspective
The
Learning &
Growth
Perspective
The Internal (Process) Perspective
I NNOVATI ON PROCE SS OP E R ATI ONS P ROCE SS P OST- SAL E S SE RV I CE P ROCE SS
The Internal
(Process)
Perspective
The Internal
(Process)
Perspective
The Internal
(Process)
Perspective
The Internal
(Process)
Perspective
The Internal
(Process)
Perspective
The Internal
(Process)
Perspective
The Internal (Process) Perspective
The Internal (Process) Perspective - Soal

The pager manufacturing cell has 1,200 hours of time available per quarter.
The cell could make 7,200 pagers but only made 6,000 during that time.
Calculate the following:

A. Theoretical cycle time in minutes.

B. Theoretical velocity per hour.
C. Actual cycle time in minutes.
D. Actual velocity per hour.
E. MCE is __________________ % (round your answer two digits).
References Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger. 2016.
Managerial Accounting: The Cornerstone of Business Decision-
Making. 7th Edition. Cengage Learning.

Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger. 2009.

Managerial Accounting: The Cornerstone of Business Decision-
Making. 6th Edition. Cengage Learning.
35