Question

Which of the following statements is true? I. A company's balanced scorecard must emanate from its Performance measures. II. For management to be effective, it should focus on business processes, rather than functional departments, to serve the needs of its customers. III. The balanced scorecard framework rejects the notion that improving process-oriented measures automatically leads to financial success. Multiple Choice Only statement I is true. Only statement II is true. Both statements II and III are true. None of the statements are true.

Answer 1

Both statements II and III are true regarding the balanced scorecard and effective management, focusing on business processes, and acknowledging that process improvements don't guarantee financial success.

Step-by-step explanation:

The correct answer to the question is that both statements II and III are true. Statement I, which says a company's balanced scorecard must emanate from its Performance measures, isn't necessarily true; the balanced scorecard should emanate from the company's vision and strategy. Statement II is true, as effective management indeed should focus on business processes to serve the needs of customers, rather than emphasizing functional departments. Lastly, statement III accurately reflects the balanced scorecard framework, which acknowledges that improving process-oriented measures does not automatically equate to financial success. This indicates that the balanced scorecard takes into account various aspects of the business and does not suggest that improvements in processes will always result in financial gains.

Answer 2

Both statements II and III are correct as the balanced scorecard includes a variety of metrics and effective management focuses on business processes, not just improving process measures for guaranteed financial success.

Step-by-step explanation:

The correct answer to the question is that both statements II and III are true. The balanced scorecard is a strategic planning and management system used to align business activities to the vision and strategy of the organization.

It is not strictly derived from performance measures; rather, it includes financial and non-financial measures that aim to provide a comprehensive view of business performance.

Additionally, effective management does indeed focus on business processes that cross functional departments to better serve customer needs, aligning with the principles of business process management.

This multidimensional approach helps to drive performance by looking at the company through different perspectives, such as customer, internal processes, learning and growth, and financial.

Lastly, the balanced scorecard framework acknowledges that while improving process-oriented measures is important, it does not guarantee financial success; it's the holistic improvement across all dimensions that leads to long-term viability and financial performance.