Western Airline (Western) is country Zs largest domestic and international airline. Passengers book flights using the internet, agents or by telephone and pay for their flights at the time of booking using a debit card or credit card. The airline has entered into profit sharing arrangement with hotels and local car hire companies that allows rooms and cars to be booked by the airlines passengers through its website.

Western currently measures its performance using financial ratios. The new CEO has suggested that there are other measures equally important as financial measures and has suggested using the Balanced Scorecard.

Required:

1. Discuss how the Balanced Scorecard differs from traditional financial performance measurement. (4 marks)

2. Identify and explain three possible non-financial performance measures (one from each of the three different perspectives of the balanced scorecard) that Western could use as part of its performance measurement process. (6 marks)