Chapter 2 Book Notes

Chapter 2 Book Notes - Chapter 2 What are the purposes of...

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Chapter 2 What are the purposes of performance measurement systems? o Communicate the company’s strategic objectives o Motivate employees to help the company achieve its strategic objectives o Evaluate the performance of managers, employees, and operating units o Help allocate resources to the most productive/profitable opportunities o Provide feedback on the changed results Why is financial accounting not enough? o Employee additions and supplies often add value to the company and it’s intellect that can not be measured in numbers The Balances Scorecard o Measures organizational performance across four different but linked perspectives that are derived from the organization’s mission, vision, and strategy Financial- how is success measured by our shareholders? Increase return on equity ROE=net income/book value Customer- how do we create value for our customers Repeat customers Growth in year-to-year sales with existing customers Process- At which processes must we excel to meet our customer and shareholder expectations? How strategy will be executed Learning and growth- what employee capabilities, information systems, and organizations capabilities do we need to continually
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This note was uploaded on 02/07/2012 for the course ACCT I S 211 taught by Professor Ta during the Fall '12 term at Wisconsin.

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Chapter 2 Book Notes - Chapter 2 What are the purposes of...

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