Chapter 9: Analysis, Forecasting and Strategy

Question 1

Balance Scorecard (goal and 4 perspectives)

Answer 1

Goal:  The balance scorecard is a tool to communicate strategy and connects the firms critical success factors to measurement of its performance. Balance scorecard by Lucia. It included KPI setting via SWOT.
4 perspectives:
o Financial
o customer satisfaction
o Internal business processes
o Learning and growth: personnel turnover, complaints, hours of training, R&D. The chaining of objectives and perspectices embodies the implementation of a strategy map.

Question 2

BCG Model (List SBUs)

Answer 2

1. Cash cow (high MS, low growth) - harvest strategy, reduce costs.
2. Stars ( high market share, high growh) - STARS ARE HIGH IN ALL - Investing Strategy a lot of cash needed to keep growth and competitivity.
   MARKET SHARE DEFINES GOOD ABOVE
3. Question marks ( high growth, low market share) -
4. Dogs ( low growth , low market share)

Question 3

Sensitivity analysis

Answer 3

The process of evaluating the effect of changes in variables such as sales price or wage rates on the optimum solution in a linear programming application is called (trial and error).

Sensitivity analysis is a process to determine how sensitive the final result (solution) is to changes in variables. It is often used in capital budgeting decisions to incorporate various levels of risk.