Mikes Bikes
Week 3 – The Balanced Scorecard – Kaplan and Norton
Squeaky Brakes focused mainly on financial perspective of our business, ignoring operational aspects. However, Kaplan and Norton suggest that there are four perspectives, which must be considered.
* How do customers see us? (customer perspective) * What must we excel at? (internal perspective) * Can we continue to improve and create value? (innovation and learning perspective) * How do we look to shareholders? (financial perspective)
To boost the customer’s perspective in future: * Market summary reports, show customer satisfaction, in terms of delivery time and loss of sales. Squeaky Brakes had a 0.9 rating at some points for delivery, resulting in 10% loss sales. In future, we should ensure we produce enough bikes for a 1.0 rating. * Should refer to perceptual map and hit segment centres so we satisfy consumer demand. This is possible through development of specs. * Market research should be used to satisfy consumer needs. Ie: high quality for road bikes, low price for youth bikes and mountain bikes are in the middle and need balance of both. * We should continue advertising and branding at high levels to drive consumer demand. Ie: advertise on TV for youth bikes and spend on PR magazines for road bikes.
The internal perspective must also be considered, focusing on internal operations of the company. * Minimize wastage or increase production depending on bike demand. Squeaky Brakes needs to increase production as we had consistently loss sales. Ie: Increase SCU (Standard capacity unit) or efficiency. * Achieve economies of scale by developing costs of bikes and efficiency * Keep inventory to a minimal as it adds extra costs to maintain it. Eg: Security and space of stock
The innovative and learning perspective is about innovation, improving and learning. We must continuously create value for consumers. * First mover advantage – try enter
Squeaky Brakes focused mainly on financial perspective of our business, ignoring operational aspects. However, Kaplan and Norton suggest that there are four perspectives, which must be considered.
* How do customers see us? (customer perspective) * What must we excel at? (internal perspective) * Can we continue to improve and create value? (innovation and learning perspective) * How do we look to shareholders? (financial perspective)
To boost the customer’s perspective in future: * Market summary reports, show customer satisfaction, in terms of delivery time and loss of sales. Squeaky Brakes had a 0.9 rating at some points for delivery, resulting in 10% loss sales. In future, we should ensure we produce enough bikes for a 1.0 rating. * Should refer to perceptual map and hit segment centres so we satisfy consumer demand. This is possible through development of specs. * Market research should be used to satisfy consumer needs. Ie: high quality for road bikes, low price for youth bikes and mountain bikes are in the middle and need balance of both. * We should continue advertising and branding at high levels to drive consumer demand. Ie: advertise on TV for youth bikes and spend on PR magazines for road bikes.
The internal perspective must also be considered, focusing on internal operations of the company. * Minimize wastage or increase production depending on bike demand. Squeaky Brakes needs to increase production as we had consistently loss sales. Ie: Increase SCU (Standard capacity unit) or efficiency. * Achieve economies of scale by developing costs of bikes and efficiency * Keep inventory to a minimal as it adds extra costs to maintain it. Eg: Security and space of stock
The innovative and learning perspective is about innovation, improving and learning. We must continuously create value for consumers. * First mover advantage – try enter