Store 24

Store 24

Question #1 Why do companies measure and analyze non-financial performance metrics? In what environment is this measurement especially beneficial?

(1) The reasons include:

(1-1) Non-financial performance metrics are leading indicators which guide management to take actions now that will have positive effects on future performance.  Financial performance metrics are lagging indicators are measures of the final outcomes of earlier management decision.

(1-2) Non-financial performance metrics enable companies to track financial results while simultaneously monitoring progress in building the capabilities and acquiring the intangible assets they would need for future growth.

(2) In a changing dynamic business environment with multiple strategies, this measurement is especially beneficial as it supplies three elements that are essential to strategic learning: 1) it articulates the company’s vision and strategy. 2) it supplies the essential strategic feedback system; 3) it facilitates the strategy review that is essential to strategic learning.

Question #2 What is the aim of the Balanced Scorecard? What are the pros and cons of this

approach?

(1) The aim of Balanced Scorecard is to drive companies balance their financial metrics with non- financial metrics so that the management will focus not only the short-term results, but also the growth in the long term. The companies are using the scorecard to:

• Increase focus on strategy and results

• Improve organizational performance by measuring what matters

• Focus on the drivers of future performance

• Improve communication of the organization’s Vision and Strategy

• Prioritize Projects / Initiatives

(2) Pros and Cons:

|Pros |Cons |

|Balance the short term financial result and long term strategy with |選擇正確的non-financial...