410)?.f.wil 85%? 2:24 PM ump to pg g book contents PROBLEM 12-21 Creating Balanced Scorecards that Support Different Steategies lLO 12-4 The Midwest Consulting Goup (MCG) helps companies build balanced scorecards. As part of its marketing efforts, MOG conducts an annual balanced scorecard workshop for prospective clients As MCGs newest employee, your boss has asked you to participate in this years workshop by expiaining to attendees how a company's strategy debermines the measures that are appropriate for its balanced scorecard. Your boss has provided you with the excerpts below from the annual reports of two current MCG clients She has asked you to use these excerpts in your portion of the workshop Excerpt from Applied Pharmaceuticals annual report The keys to our business are consistent and timely new product ntroductions and manufacturing process integrity. The new product introduction side of the equation is a function of research and development (R&D) yield (e.g, the number of mafketable drug compounds created reletive to the total number of potential compounds pursued) We seek to optimize our R&D yield and firsto- market capability by investing in state-of te art technology, hiring the highest possible percentage of the "best and the brightest engineers that we pursue, and providing world-class training to those engineers Manufacturing process integrity is all about establishing wold class quality specications and then relentlessly engaging in prevention and appraisal activities to minimize defect rates. Our customens must have an awareness of and respect for our brand image of being irst so market and first in quality If we deliver on this pledge to our customers, then our fnancial goal of increasing our return on sockholders' equity should take care of itsel Excerpt from Destination Resorts Internationals annual report Our business succeeds or fails based on the quality of the service that our front-line employees provide to customers. Therefore, iais mperative that we strive to maintain high employee morale and mirimize employee turnover. In addtion in is critical that we train our employees to use technology to create one seamless worldwide experience for our repeast customers. Once an employee entersa customer preference (e g,povide two extra pilows in the room deliver fresh brewed coffee to the room at 8.00 AM, etc.) into ou database, our worldwide workforce strives to ensure that a customer will never need to repeat it at any of our destination resorts. If we properly train and retain a motivated workforce, we should see continuous improvement in our percentage of error-free repeat stormer check-ns, the time taken to resolve customer complaint and our independently assessed soom cleanliness. This in turn should drive improvement in our customer retention, which is the key to meeting our revenue growth goals Required 1 Based on the excerpts above, compare and contrast the strategies of Applied Pharmaceuticals and Destination Resorts International 2 Select balanced scorecard measures for each company and link the scorecard measures using the framework from Exhibit 12-5. Use ansows to show the causal lnks between the performance measunes and show whether the performance measure should increase or decrease over time. Feel free to create measures that may not be specifically mentioned in the chaptet but nonetheless make sense given the strategic goals of each company 3 What hypotheses are built into each balanced scorecard? Why do the hypotheses differ between the two companies? 410)?.f.wil 85%? 2:24 PM ump to pg g book contents PROBLEM 12-21 Creating Balanced Scorecards that Support Different Steategies lLO 12-4 The Midwest Consulting Goup (MCG) helps companies build balanced scorecards. As part of its marketing efforts, MOG conducts an annual balanced scorecard workshop for prospective clients As MCGs newest employee, your boss has asked you to participate in this years workshop by expiaining to attendees how a company's strategy debermines the measures that are appropriate for its balanced scorecard. Your boss has provided you with the excerpts below from the annual reports of two current MCG clients She has asked you to use these excerpts in your portion of the workshop Excerpt from Applied Pharmaceuticals annual report The keys to our business are consistent and timely new product ntroductions and manufacturing process integrity. The new product introduction side of the equation is a function of research and development (R&D) yield (e.g, the number of mafketable drug compounds created reletive to the total number of potential compounds pursued) We seek to optimize our R&D yield and firsto- market capability by investing in state-of te art technology, hiring the highest possible percentage of the "best and the brightest engineers that we pursue, and providing world-class training to those engineers Manufacturing process integrity is all about establishing wold class quality specications and then relentlessly engaging in prevention and appraisal activities to minimize defect rates. Our customens must have an awareness of and respect for our brand image of being irst so market and first in quality If we deliver on this pledge to our customers, then our fnancial goal of increasing our return on sockholders' equity should take care of itsel Excerpt from Destination Resorts Internationals annual report Our business succeeds or fails based on the quality of the service that our front-line employees provide to customers. Therefore, iais mperative that we strive to maintain high employee morale and mirimize employee turnover. In addtion in is critical that we train our employees to use technology to create one seamless worldwide experience for our repeast customers. Once an employee entersa customer preference (e g,povide two extra pilows in the room deliver fresh brewed coffee to the room at 8.00 AM, etc.) into ou database, our worldwide workforce strives to ensure that a customer will never need to repeat it at any of our destination resorts. If we properly train and retain a motivated workforce, we should see continuous improvement in our percentage of error-free repeat stormer check-ns, the time taken to resolve customer complaint and our independently assessed soom cleanliness. This in turn should drive improvement in our customer retention, which is the key to meeting our revenue growth goals Required 1 Based on the excerpts above, compare and contrast the strategies of Applied Pharmaceuticals and Destination Resorts International 2 Select balanced scorecard measures for each company and link the scorecard measures using the framework from Exhibit 12-5. Use ansows to show the causal lnks between the performance measunes and show whether the performance measure should increase or decrease over time. Feel free to create measures that may not be specifically mentioned in the chaptet but nonetheless make sense given the strategic goals of each company 3 What hypotheses are built into each balanced scorecard? Why do the hypotheses differ between the two companies