ACCT 3107 · Strategic Performance Measurement · Beyond the Balanced Scorecard

Led by Margaret Vance-Foster Simulacrum

1. Module 7 ○ Open

   Strategic Performance Measurement · Beyond the Balanced Scorecard

   Led by Margaret Vance-Foster Simulacrum

   The question

   Strategic performance measurement beyond the textbook Balanced Scorecard. The module covers Kaplan and Norton's Scorecard and Strategy Maps in genuine application (not as a template-fill exercise), the Performance Prism, OKRs as used in technology firms, the discipline of the *critical few* against measurement-system bloat, Goodhart's Law and the gaming problem, and the design of a measurement system aligned to a stated strategy. The worked exercise builds a Scorecard for a UK mid-market commercial bank pursuing a five-year cost-income and ROE target.

   Outcome

   The student can design a strategic performance measurement system from a stated strategy, identify the critical few measures across four or five perspectives, anticipate the gaming risks for each measure, and articulate the cultural conditions under which the system will or will not drive intended behaviour. (Strategic performance measurement)

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   Practice scenarios

   Designing the Scorecard for a Mid-Market Bank

   You design a Balanced Scorecard for a UK mid-market commercial bank with a five-year cost-income and ROE target. The work tests whether you can move beyond template-fill scorecard design to a small set of genuinely strategic measures, and whether you can anticipate the gaming behaviour each measure will provoke.

   Your goals

   • Build the strategy map: how does *learning-and-growth* (digital platform investment, banker training, data capability) produce *internal-process* outcomes (faster credit decisions, lower service cost, better risk pricing) which produce *customer* outcomes (NPS, retention, share of wallet, win rate vs incumbents) which produce *financial* outcomes (ROE, cost-income ratio, growth)?
   • Design 5–7 measures per perspective. Financial: ROE, cost-income ratio, organic growth %, NPL ratio. Customer: NPS, gross client gain/loss, average revenue per client, share of wallet. Internal: credit-decision time, cost per transaction, banker portfolio size, regulatory clean-audit count. Learning: digital adoption %, banker tenure, training completion, data-capability index.
   • Define each measure precisely (denominator, frequency, owner, target).
   • Identify gaming risks for each (e.g. NPS gaming through selection bias of who is surveyed; cost-income ratio gaming through deferred investment; credit-decision time gaming through declining edge cases).
   • Recommend the cadence (monthly executive review; quarterly board review; annual strategy revision) and the consequence structure (what happens if measures are missed?).
   • Frame as a 1,000-word board paper.

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