Chapter 22: The Development and Use of a Global Marketing and Sales Scorecard
Robert L. Engle INTRODUCTION It has been suggested that assessing the company’s current ﬁnancial position through the use of metrics such as ﬁnancial ratios is a major step in the strategic planning process. These ﬁnancial ratios tend to be the major analyses tools being used by many company management teams in their attempt to evaluate and control the current and future health of their organizations (Brigham and Gapenski 1997). However, Kaplan and Norton’s (1992) research of 12 companies highlighted their eﬀorts to develop a set of metrics to measure performance that went beyond the standard ﬁnancial measures. They opened their Harvard Business Review article with ‘What you measure is what you get’ (p. 71), recognizing that organizations will focus on those objectives on which they are being measured. They built a case not only for business metrics covering key ﬁnancial measures that report the results of actions already taken, but also using ‘operational’ measures that are the critical drivers of future ﬁnancial performance. This more comprehensive approach of using ﬁnancial and operational measures has been labeled the ‘business scorecard’. THE BUSINESS SCORECARD Kaplan and Norton (1992) suggested that a balanced scorecard covers four areas including: a ﬁnancial perspective (How does the company look to its shareholders?); a customer perspective (How do customers see the company?); an internal business perspective (What must the company excel at?); and an innovation and learning perspective (How can the company continue to improve and create value?). These last three perspectives – customer, internal business, and...
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