Store24 Balanced Scorecard Harvard Business School

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08-081 Testing Strategy with Multiple Performance Measures Evidence from a Balanced Scorecard at Store24 Dennis Campbell Srikant M. Datar Susan L. Kulp V.G. Narayanan Copyright © 2008 by Dennis Campbell, Srikant M. Datar, Susan L. Kulp, and V.G. Narayanan Working papers are in draft form. This working paper is distributed for purposes of comment and discussion only. It may not be reproduced without permission of the copyright holder. Copies of working papers are available from the author. Testing Strategy with Multiple Performance Measures Evidence from a Balanced Scorecard at Store24* Dennis Campbell Srikant Datar Harvard Business School Susan L. Kulp George Washington University V.G. Narayanan Harvard Business…show more content…
Further, performance measures should be explicitly linked via a "strategy-map" of hypothesized "cause-and-effect" relationships that depict the firm 's strategy (Kaplan and Norton 2000; 2004). Improvements in measures of organizational capabilities are expected to drive improvements in the execution of internal processes which in turn lead to customer and financial outcomes. In this way, the balanced scorecard framework explicitly recognizes interrelationships between strategy-specific measures of financial and customer outcomes and inputoriented "performance drivers" related to the firm 's internal processes and organizational capabilities. However, managers must formulate strategies, and select related objectives and measures, based on exante expectations about how the strategy will translate into financial performance. Thus, the strategic objectives and performance measures chosen for an organization 's scorecard are often based on uncertain hypotheses about how measured performance against these objectives ultimately leads to financial performance. Proponents of the balanced scorecard concept have long recognized this uncertainty. To mitigate against it, and as a mechanism for strategic feedback and learning, they have

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