As soon as he saidMoney isnt Everything I

As soon as he said“Money isn’t Everything” - I knew we were in trouble

It is important to focus on the means used to achieve the ends … …. . not just on the ends themselves… To only focus on traditional financial accounting measures (such as ROI, ROE, EPS…) …. . does not give mgt the whole picture….

Performance needs to be judged thru mix Will Make $$$ - if sell product of: financial measures…. & - non-financial measures …which drive financial outcomes Will sell product if consumer wants, knows about , can get, & LIKES product To achieve “above’ everyone must effectively do their job To effectively do job must know what to do

Strategic Thinking- the ten big ideas 9 9. Metrics that matter Balanced score card- a system that attempts to balance financial performance w/ consideration of: – customer's perspective – learning & growth perspective – & internal business

Today … Vast majority Fortune 1, 000 Companies utilize a Balanced Scorecard to help manage performance— What is measured gets noticed What is noticed gets acted on What is acted on gets improved

For Each Perspective: Financial… Objectives Measures Targets Initiatives Responsibility Budget 1. 2. 3. Customer… Business Processes…Learning & Growth Objectives Measures Targets Initiatives Responsibility Budget 1.

Basic Scorecard Terminology (Southwest Airlines Example) Strategy Map Strategic Theme: Operating Efficiency Profits and RONA Financial Grow Revenues Customer Fewer planes Attract & Retain More Customers On-time Service Objective s: What the strategy is trying to achieve Measures Targets Initiatives. K How performanc e is measured against objectives The level of performanc e or rate of ey action programs required to achieve targets improvement needed Lowest prices Objectives Internal Fast ground turnaround Learning Ground crew alignment • Fast ground turnaround Measures • On Ground Time • On-Time Departure Targets Initiatives • 30 Minutes • Cycle time • 90% optimizatio n

A Complete Scorecard is a Program for Action Strategic Theme: Operations Operating Excellence Efficiency Profits and RONA Financial Grow Revenues Customer Fewer planes Attract & Retain More Customers On-time Service Lowest prices Internal Objectives • More Customers • # Customers • Flight is on -time • FAA On Time Arrival Rating • Lowest prices • Market Survey turnaround Ground crew alignment • 12% growth • Customer • Ranked #1 loyalty • Ranked #1 program • Quality management • On Ground Time • 30 Minutes • Cycle time • On-Time • 90% optimization Departure • Ground crew Learning Targets Initiatives • 30% +/yr • Profitability • Grow Revenues • 20% • Fewer planes • 5% • Fast ground turnaround Measures alignment • % Ground crew • yr. 1 trained • % Ground crew stockholders 70% yr. 3 90% yr. 5 100% • Ground crew training • ESOP

Partnering & the Balanced Scorecard

Capstone's Balanced Scorecard

Vide o How to use The Capstone Balanced Scorecard

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