Achieving Strategy through Balancing Competing
The primary goal of any business is to increase
stakeholder value. It is achieved through a dynamic balancing of competing
values. In order for a business to maximize economic value, it must balance
customer satisfaction and competitive market forces with internal cost and
What is Business Systems Approach?
A business is more than finance. Organizations
prosper by achieving strategy that is implemented as a result of continuous
decision-making at all levels of the business. Performance measures need to
be aligned with the organization's strategy. The Business Systems approach
considers business as system of interrelated factors of strategy, owners,
investors, management, workers, finance, processes, products, suppliers,
customers, and competitors.
Balancing the Four Perspectives
Firms implement strategy through balancing the
four major factors or perspectives:
Financial perspective: To succeed financially, how should we look to our
Customer perspective: To achieve our vision, how should we appear to our
Internal business process perspective: To satisfy our shareholders and
customers, what business processes must we excel at?
Learning, innovation, and growth perspective: To achieve our vision, how
will we sustain our ability to create value and improve?
The four perspectives permit a balance between short-term and long-term
objectives, between outcomes desired and the performance drivers of those
outcomes, and between hard objective measures and soft subjective measures.
For each of the above four questions, provide answers in terms of: