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CA Final · Integrated Business Solutions (Multidisciplinary Case Study with Strategic Management) · Strategic Cost & Performance Management

Case: Anand Foods Ltd (Ahmedabad) is building a Balanced Scorecard. Management proposes: Customer perspective measure = 'customer satisfaction index'; Internal process measure = 'cycle time per batch'. The Finance head wants to show that improving cycle time leads to better financial results. Which BSC feature does this linkage illustrate?

This illustrates cause-and-effect relationships among the Balanced Scorecard perspectives, often shown in a strategy map. Better internal process performance such as shorter cycle time improves customer outcomes, which in turn drive financial results.

  1. ACause-and-effect relationships among perspectives in a strategy mapCorrect
  2. BBenchmarking against industry peers
  3. CZero-based budgeting of process costs
  4. DTarget costing of the product

Explanation

The Balanced Scorecard links learning and growth to internal processes, then customers, then financial outcomes through cause-and-effect chains, shown in a strategy map. Benchmarking, ZBB and target costing do not describe this linkage.

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