Question 1

The customer perspective of the balanced scorecard answers which of the following questions?
A)How do customers see us?
B)What must we excel at?
C)How do we look to shareholders?
D)Can we continue to improve and create value?

Accepted Answer

Clearly, how a company is performing from the customer perspective is a top priority for management. The balanced scorecard requires that managers translate their general mission statements on customer service into specific measures that reflect the factors that really matter to customers.

Question 2

The internal business perspective of the balanced scorecard answers which of the following questions?
A)How do customers see us?
B)What must we excel at?
C)How do we look to shareholders?
D)Can we continue to improve and create value?

Accepted Answer

The internal measures should reflect business processes that have the greatest impact on customer satisfaction. These include factors that affect cycle time, quality, employee skills, and productivity.

Question 3

If managers do not recognize from the beginning that the balanced scorecard is not a _________ and fail to commit to it long term, the organization will be disappointed.
A)panacea
B)quick fix
C)marketing ploy
D)cheap solution

Accepted Answer

There is general agreement that there is nothing inherently wrong with the concept of the balanced scorecard. The key limitation is that some executives may view it as a quick fix that can be easily installed. If managers do not recognize this from the beginning and fail to commit to it long term, the organization will be disappointed.

Question 4

The balanced scorecard, developed by Kaplan and Norton, helps to integrate
A)financial analysis and the reputation of a firm.
B)intangible resources and operational measures.
C)financial analysis and stakeholder perspectives.
D)short-term perspectives and strategic positioning.

Accepted Answer

The balanced scorecard enables managers to consider their business from four key perspectives: customer, internal, innovation and learning, and financial.

Question 5

With the total performance indicators in place at Sears, it can evaluate if a single store improves its employee attitude by 5 percent and therefore predict with confidence that if the revenue growth in the district as a whole is 5 percent, the revenue growth in this particular store would be 5.5 percent. This is an example of the _______ perspective of the balanced scorecard.
A)customer
B)internal business
C)financial
D)innovation and learning

Accepted Answer

Sears, the retailer, found a strong causal relationship between employee attitudes, customer attitudes, and financial outcomes. Through an ongoing study, Sears developed what it calls its total performance indicators (TPI) which is a set of indicators for assessing its performance with customers, employees, and investors. The Sears quantitative model has shown that a 5 percent improvement in employee attitudes leads to a 1.3 percent improvement in customer satisfaction, which in turn drives a 0.5 percent improvement in revenue. Thus, if a single store improved its employee attitude by 5 percent, Sears could predict with confidence that if the revenue growth in the district as a whole were 5 percent, the revenue growth in this particular store would be 5.5 percent.

Question 6

The balanced scorecard enables managers to consider their business from all of the following perspectives except
A)customer perspective.
B)internal perspective.
C)innovation and learning perspective.
D)ethical perspective.

Accepted Answer

The balanced scorecard enables managers to consider their business from four key perspectives: customer, internal, innovation and learning, and financial.

Question 7

The balanced scorecard provides top managers with a __________ view of the business.
A)detailed and complex
B)simple and routine
C)fast but comprehensive
D)long-term financial

Accepted Answer

A balanced scorecard provides top managers with a fast but comprehensive view of the business. In a nutshell, it includes financial measures that reflect the results of actions already taken, but it complements these indicators with measures of customer satisfaction, internal processes, and the innovation and improvement activities of the organization.

Question 8

The internal measures should reflect business processes that have ______ impact on customer satisfaction. These include factors that affect cycle time, quality, employee skills, and productivity.
A)the least
B)variable
C)the most
D)potential

Accepted Answer

The internal measures should reflect business processes that have the greatest impact on customer satisfaction. These include factors that affect cycle time, quality, employee skills, and productivity.

Question 9

An important implication of the balanced scorecard approach is that
A)managers need to recognize that satisfaction of stockholder demands is their primary job.
B)the emphasis on customer satisfaction and financial goals are only a means to that end.
C)managers should not look at their job as primarily balancing stakeholder demands.
D)gains in financial performance must come at a cost of employee satisfaction.

Accepted Answer

A key implication is that managers do not need to look at their job as balancing stakeholder demands. The balanced scorecard provides a win-win approach, increasing satisfaction among a wide variety of organizational stakeholders, including employees (at all levels), customers, and stockholders.

Question 10

A firm that takes on too much long-term debt to finance operations will see an immediate impact on its indicators of _______ financial leverage.
A)short-term
B)long-term
C)relative
D)comparable

Accepted Answer

a firm that takes on too much long-term debt to finance operations will see an immediate impact on its indicators of long-term financial leverage.

Question 11

Apple Inc. reported revenues of 171 billion USD and net income of 37 billion USD in 2012. These figures represent a stunning annual growth in revenue and net income of 57 percent and 43 percent, respectively, for the 2011 to 2013 time period. This information indicates the importance of using __________ to evaluate company financial performance.
A)financial ratios
B)industry norms
C)historical comparisons
D)competitor analysis

Accepted Answer

When evaluating company financial performance, it is very useful to compare its financial position over time. This provides a means of evaluating trends. For example, Apple Inc. reported revenues of 171 billion USD and net income of 37 billion USD in 2012. These figures represent a stunning annual growth in revenue and net income of 57 percent and 43 percent, respectively, for the 2011 to 2013 time period. Had Apple's revenues and net income in 2013 been 80 billion USD and 20 billion USD, respectively, it would still be a very large and highly profitable enterprise. However, such performance would have significantly damaged Apples market valuation and reputation as well as the careers of many of its executives.

Question 12

The financial perspective of the balanced scorecard answers which of the following questions?
A)How do customers see us?
B)What must we excel at?
C)How do we look to shareholders?
D)Can we continue to improve and create value?

Accepted Answer

Measures of financial performance indicate whether the company strategy, implementation, and execution are indeed contributing to bottom-line improvement. This interests the shareholder.

Question 13

The innovation and learning perspective of the balanced scorecard answers which of the following questions?
A)How do customers see us?
B)What must we excel at?
C)How do we look to shareholders?
D)Can we continue to improve and create value?

Accepted Answer

Given the rapid rate of markets, technologies, and global competition, the criteria for success are constantly changing. To survive and prosper, managers must make frequent changes to existing products and services as well as introduce entirely new products with expanded capabilities. The company ability to do well from an innovation and learning perspective is more dependent on its intangible than tangible assets.

Question 14

From the innovation and learning perspective, survival is dependent upon managers making _________ changes to existing products and services as well as introduce entirely new products with expanded capabilities.
A)few
B)no
C)frequent
D)rare

Accepted Answer

Given the rapid rate of markets, technologies, and global competition, the criteria for success are constantly changing. To survive and prosper, managers must make frequent changes to existing products and services as well as introduce entirely new products with expanded capabilities.

Quiz 3: Assessing the Internal Environment of the Firm

The customer perspective of the balanced scorecard answers which of the following questions?

The internal business perspective of the balanced scorecard answers which of the following questions?

If managers do not recognize from the beginning that the balanced scorecard is not a _________ and fail to commit to it long term, the organization will be disappointed.

The balanced scorecard, developed by Kaplan and Norton, helps to integrate

The balanced scorecard enables managers to consider their business from all of the following perspectives except

The balanced scorecard provides top managers with a __________ view of the business.

The internal measures should reflect business processes that have ______ impact on customer satisfaction. These include factors that affect cycle time, quality, employee skills, and productivity.

An important implication of the balanced scorecard approach is that

A firm that takes on too much long-term debt to finance operations will see an immediate impact on its indicators of _______ financial leverage.

The financial perspective of the balanced scorecard answers which of the following questions?

The innovation and learning perspective of the balanced scorecard answers which of the following questions?

From the innovation and learning perspective, survival is dependent upon managers making _________ changes to existing products and services as well as introduce entirely new products with expanded capabilities.