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Scott Company manufactures a DVD player called Orlicon. The company sells the player to discount stores throughout the country. This player is significantly less expensive than similar products sold by Scotts competitors, but the Orlicon offers just DVD playback, compared with DVD and Blu-ray playback offered by competitor Nomad Manufacturing. Furthermore, the Orlicon has experienced production problems that have resulted in significant rework costs. Nomads model has an excellent reputation for quality. The following information is provided:

a. Scott currently follows a cost leadership strategy, which is reflected in its lower price compared to its competitors. b. The following figure shows Scotts Strategy Map with the 4 perspectives and related objectives.

image text in transcribed

c. The following table shows the objectives and measures for Scotts emerging Balanced Scorecard.

Financial Perspective

Operating income from productivity and quality improvement

Operating income from growth

Revenue growth

Customer Perspective

Market share

Number of additional customers

Customer-satisfaction ratings

Internal-Business- Process Perspective

Percentage of defective products sold

Number of major improvements in manufacturing process

Learning-and- Growth Perspective

Employee-satisfaction ratings

Percentage of employees trained in quality management

Percentage of line workers empowered to manage processes

Percentage of manufacturing processes with real-time feedback

Required:

1. Given the Strategy Map, strategic objectives for each of the four (4) perspective and the related measures, complete the Balanced Scorecard for Scott by improving on the measures and adding a complete set of Targets and Initiatives for each objective. (36 marks)

2. Ensure the alignment of the BSc metrics with the given objectives. (24 marks)

3. Give two (2) examples of environmental costs relevant to the DVD manufacturing industry and discuss briefly how each cost might affect any two Perspectives on Scotts Balanced Scorecard. (10 marks)

al Poin FINANCIAL PERSPECTIVE Increase operating income from productivity and quality Grow revenues Grow operating income cal Poin CUSTOMER PERSPECTIVE Increase customer satisfaction Increase customers Increase market share in electric motors market ager Point Trigger Improve quality INTERNAL- BUSINESS- PROCESS PERSPECTIVE Triggere Improve productivity Improve manufacturing processes Focal Point LEARNING- AND GROWTH- PERSPECTIVE Align employee and organization cal Point Train employees to develop process skill Improve manufacturing feedback goals Trigger Point Empower employees al Poin FINANCIAL PERSPECTIVE Increase operating income from productivity and quality Grow revenues Grow operating income cal Poin CUSTOMER PERSPECTIVE Increase customer satisfaction Increase customers Increase market share in electric motors market ager Point Trigger Improve quality INTERNAL- BUSINESS- PROCESS PERSPECTIVE Triggere Improve productivity Improve manufacturing processes Focal Point LEARNING- AND GROWTH- PERSPECTIVE Align employee and organization cal Point Train employees to develop process skill Improve manufacturing feedback goals Trigger Point Empower employees

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