ITPEC IP October 2019 Question 80
Airline Company A set out a strategic goal for each of the four (4) viewpoints of a Balanced Scorecard (BSC) to achieve the business strategy. Which of the following corresponds to II? Here, each of I through IV corresponds to one of a) through d).
Explanation
Customer viewpoint — offering the lowest fare on a competing route is a goal about what the customer gets.
A Balanced Scorecard sets goals from four viewpoints, linked as causes and effects. Matching the airline's goals:
- •I Improved profit ratio — financial viewpoint: the result for shareholders
- •II Minimum airfare for the competing route — customer viewpoint: the value offered to passengers to win them
- •III Increased actual operating hours of aircraft — business process viewpoint: running the internal operations more efficiently
- •IV Improved teamwork among aircraft engineers — learning and growth viewpoint: the people and organization behind the processes
Answer (c)
Why not others:
- •(a) Learning and growth viewpoint — covers staff skills, teamwork and organizational culture: goal IV
- •(b) Business process viewpoint — covers the efficiency and quality of internal operations: goal III
- •(d) Financial viewpoint — covers profit, revenue and returns: goal I
Key rule: A BSC reads from the bottom up: learning and growth improves the business processes, better processes deliver value to customers, and satisfied customers produce the financial results.
Business Strategy Management · AI-written, may contain errors
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