Answer the following statements true (T) or false (F)

Question

1. Financial measures like quarterly sales figures are not adequate for gauging changes in contemporary value-creating activities. 
2. Computer information systems are helpful in the internal business perspective of the balanced scorecard. 
3. A strategy map is a visual representation of the four perspectives of the balanced scorecard that enables managers to communicate their goals. 
4. Strategy maps show the cause-and-effect links between environmental factors and preferred strategy. 

Answer 1

1. TRUE
Financial measures such as quarterly sales have been criticized as being shortsighted and not reflecting contemporary value-creating activities. Moreover, critics say that traditional financial measures don't improve customer satisfaction, quality, or employee motivation.
2. TRUE
The internal business perspective is what the company must do internally to meet its customers' expectations. These are business processes such as quality, employee skills, and productivity. Top management's judgment about key internal processes must be linked to measures of employee actions at the lower levels. Computer information systems can help, for example, in identifying late deliveries, tracing the problem to a particular plant.
3. TRUE
A strategy map is a visual representation of the four perspectives of the balanced scorecard that enables managers to communicate their goals so that everyone in the company can understand how their jobs are linked to the overall objectives of the organization.
4. FALSE
As Kaplan and Norton state, "Strategy maps show the cause-and-effect links by which specific improvements create desired outcomes," such as objectives for revenue growth, targeted customer markets, the role of excellence and innovation in products, and so on.