ACCA Strategic Professional · Advanced Performance Management · Non-financial performance measurement
Orrin Retail has introduced a scorecard. Its learning and growth perspective currently includes the measure 'percentage of staff completing the annual compulsory training programme'. A consultant criticises it. Which criticism is most consistent with balanced scorecard theory?
The best criticism is that the measure tracks training activity, not the capabilities or results the strategy needs. Learning and growth measures should show whether skills, systems and culture are improving in ways that support the other perspectives, so completion percentages alone may not drive strategic performance.
- AIt measures activity rather than the capability or outcome the strategy requires, so it may not drive performanceCorrect
- BLearning and growth measures should never be included in a scorecard
- CIt should be moved to the financial perspective because training is a cost
- DIt is too closely linked to customer outcomes to be useful
Explanation
Learning and growth measures should reflect the capabilities staff, systems and culture need to deliver the strategy, such as skills attained or employee satisfaction. Completion rates record only input activity. The other options are wrong because this perspective is a core part of the scorecard and cost does not decide classification.
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