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AAA opinions on business partnering strategy

The faculty’s Rick Payne chaired a panel at the American Accounting Association conference to discuss ways finance business partners can play a bigger role in strategy.

We brought together four leading thinkers and asked them a simple question: how can finance professionals improve their influence on business strategy? The discussion generated a wide range of ideas as part of the American Accounting Association (AAA), Management Accounting Section conference in Scottsdale, Arizona, this January.

Strengths and weaknesses of the BSC

The reach of the balanced scorecard (BSC) means many organisations look beyond the financials when assessing performance. When structured as a strategy map, the BSC quadrants – financial, customer, internal processes and learning and growth – provide a perspective on strategy and the cause and effect relationships between actions and outcomes. However, an over-reliance and narrow use of BSCs can result in weaknesses and blind spots.

For example, professor Elaine Harris, University of Roehampton, pointed out that the measures in the balanced scorecard are rarely linked to what is written in strategic investment proposals, where NPV comparisons remain the order of the day. Professor Rajiv Banker, Temple University, questioned whether the BSC should be treated as balanced at all. If you follow a customer intimacy strategy, the focus should be on the customer quadrant. If it’s product leadership, learning and growth should be to the fore, and if it’s an excellence/cost leader strategy, it will require excellent internal processes.

This is an extract from the Business & Management Magazine, Issue 263, April 2018. 

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