Business Performance Management Balanced Scorecard Framework 2

Question 1

What is a 'strategic objective' in the Balanced Scorecard framework?

Accepted Answer

A concise statement describing what must be achieved within a specific perspective to execute strategy

Answer

Strategic objectives are specific, actionable statements within each BSC perspective that describe what the organization must accomplish.

Question 2

In Balanced Scorecard terminology, what is an 'initiative'?

Accepted Answer

A key action program undertaken to achieve strategic objectives

Answer

Initiatives are the specific projects and programs that an organization undertakes to close the gap between current and target performance on strategic objectives.

Question 3

Which of the following BEST describes 'strategic alignment' in the Balanced Scorecard?

Accepted Answer

Linking individual, department, and business unit scorecards to the overall corporate strategy

Answer

Strategic alignment ensures that every level of the organization is working toward the same overarching strategy through cascaded scorecards.

Question 4

What does 'cause-and-effect linkage' mean in the Balanced Scorecard framework?

Accepted Answer

Identifying how improvements in one perspective lead to improvements in another

Answer

Cause-and-effect linkages show how improving learning and growth leads to better internal processes, which improves customer outcomes, which drives financial results.

Question 5

A technology company includes 'percentage of revenue from new products' in its Balanced Scorecard. Which perspective does this KPI belong to?

Accepted Answer

Financial perspective

Answer

Revenue from new products is a financial outcome measure, placing it firmly in the financial perspective of the Balanced Scorecard.

Business Performance Management Practice Test

Business Performance Management Practice Test

Business Performance Management Balanced Scorecard Framework 2