After you have read the article and watched the short video, post your answer to the following discussion questions.
Discussion Question #1: Kaplan and Norton describe the second step of the strategic management process as “Communicating and Linking.” This step allows managers to communicate their strategy up and down the organization while linking that strategy to departmental and individual objectives. Discuss the three activities that balanced scorecard users generally engage in to align employees’ individual performances with the organization’s overall strategy. Do you feel that individual performance metrics in most organizations focus on short-term more than long-term goals? If so, does this have a negative or positive impact on the overall organization? Explain your answer and provide a real-world example.
Discussion Question #2: The authors discuss a disconnect between most firm’s vision for the future and the execution of day-to-day actions of both employees and executives. To address this issue, the 25 executives at Metro Bank had to “clarify the meaning of the strategy statement.” Clarifying the strategy statement was the groundwork for creating a balanced scorecard. Do you think that your company’s mission is clear and that it is being executed in an efficient way? Discuss in what way(s) your company would benefit from clarifying the mission statement. If you feel it is clear already, have executives balanced the focus on strategic as well as financial objectives?
Discussion Question #3: Kaplan and Norton explain that in order to create a successful strategic management system, it is important that companies engage in strategic learning. What do they mean by “strategic learning?” Use a real-world example in your explanation. Explain the difference between “single-loop” learning and “double-loop” learning. The article discusses how budget reviews and other financially-based tools do not facilitate double-loop learning because they generally only use a single perspective. Can you think of ways management can use double-loop learning to manage the performance of the firm’s strategic objectives? The authors warn against managers not taking disconfirming evidence seriously. What is disconfirming evidence and why is it important? Give a real-world example.
Discussion Question #4: The article discusses the differences between “intangible” and “tangible” assets. Is one more important than the other? Is one more likely to give a firm a sustainable competitive advantage? What recent social, economic, or political changes have led to this? Discuss and provide the rationale for your answer, and in doing so, be sure to provide some real-world examples of how firms have used their tangible and/or intangible assets to develop a sustainable competitive advantage.
Videolink: Balanced Scorecard (youtube.com)
