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ACCA Strategic Professional · Advanced Performance Management · Performance optimisation in specific contexts

Teska Ltd, a software firm, uses a balanced scorecard. It reports on-time project delivery of 96% and customer complaints falling, but revenue growth is flat and staff turnover among developers has risen to 25%. Which perspective is the most likely leading indicator of the problem to investigate?

The learning and growth perspective is the most likely source. Rising developer turnover suggests lost skills and capability, which usually drives later problems in processes, customers and revenue, whereas flat revenue is only a lagging outcome and the other measures are currently positive.

  1. AFinancial perspective, as revenue is a lagging measure
  2. BLearning and growth perspective, as developer turnover may erode future capabilityCorrect
  3. CCustomer perspective, as complaints are falling
  4. DInternal process perspective, as delivery is on time

Explanation

High developer turnover in the learning and growth perspective is a leading indicator that future innovation, quality and delivery capacity may decline. Revenue is a lagging result, and customer and process measures currently look favourable, so they are not the best place to look for the emerging problem.

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