PROBLEM 10-20 Creating Balanced Scorecards that Support Different Strategies [L05] The Midwest Consulting Group (MCG) helps companies build balanced scorecards. As part of its marketing efforts, MCG conducts an annual balanced scorecard workshop for prospective clients. As MDG'S newest employee, your boss has asked you to participate in this year's workshop by explaining to attendees how a company's strategy determines 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 sue these excepts as a basis for facilitating your portion of the workshop.
Excerpt from Applied Pharmaceuticals annual report:
The keys to our business are consistent and timely new product introductions and manufacturing 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 marketable drug compounds created relative to the total number of potential compounds pursued). We seek to optimize our R&D yield and first-to-market capability by investing in state-of-the-art technology, hiring the highest possible percentage of the “best and the brightest” engineering that we pursue, and providing world-class training to those engineers. Manufacturing process integrity is all about establishing world-class training to those engineers. Manufacturing process integrity is all about establishing world-class quality specifications and then relentlessly engaging in prevention and appraisal activities to minimize defect rates. Our customers must have an awareness of and respect for our brand image of being “first to market and first in quality.” if we deliver on this pledge to our customers, then our financial goal of increasing our return on stockholders' equity should take are of itself
Excerpt from Destination Resorts International's annual report
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