Oliva Corporation is a small company that manufactures high-end stereo equipment. Oliva sells its products primarily via specialty audio-video stores. The discerning buyers of the firm’s products have strong opinions about the relative merits of different brands, which means that they are not very price sensitive. The firm seeks your advice regarding how best to measure its progress on marketing and related issues. Last year’s volume was just below 50,000 units; for this year, the firm projects 60,000 units and hopes to reach 100,000 units in three years.
The firm’s founders strongly believe that quality is paramount. They argue that customer satisfaction with product quality (ignoring price and other issues) is key for such purchases. Thus, they wish to measure the number of 5-star reviews or customer satisfaction scores (on quality) as the measure of choice. Their nephew, who recently took over as CEO, concedes the quality point. However, pointing to the firm’s plans to expand its customer base, he also wishes to measure the visibility of the firm’s brands among target segments. “You can’t buy what you don’t know, even if it has the best quality,” is his logic. Oliva’s marketing manager (also a recent hire) agrees with visibility and suggests that Oliva measure market penetration, measured as the number of new stores carrying the firm’s products.

Required:
a. What is Oliva’s critical success factor that pertains to its interactions with its customer base?
b. Suppose Oliva wants to construct a balanced scorecard. What measures could it include in the category for capturing external perceptions? What kinds of actions would each measure encourage? Are these actions consistent with the firm’s strategy?