Rocky Plain Company provides cable and Internet services in the greater Denver area. There are many competitors that provide similar services. Rocky Plain believes that the key to financial success is to offer a quality service at the lowest cost. Rocky Plain currently spends a significant amount of hours on installation and post-installation support. This is one area that the company has targeted for cost reduction. Rocky Plain?s balanced scorecard for 2013 follows.

Required

1. Was Rocky Plain successful in implementing its strategy in 2013? Explain.

2. Do you agree with Rocky Plain?s decision to include measures of developing innovative services (research and development costs) in the internal-business-process perspective of the balanced score-card? Explain briefly.

3. Is there a cause-and-effect linkage between the measures in the internal-business-process perspective and the customer perspective? That is, would you add other measures to the internal-business-process perspective or the customer perspective? Why or why not? Explain briefly.

4. Why do you think Rocky Plain included balanced scorecard measures relating to employee safety and community engagement? How well is the company doing on these measures?

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Target Actual Objectives Measures Performance Performance Financial Perspective Increase shareholder value Operating-income changes from productivity Operating-income changes from growth $1,200,000 $400,000 $260,000 $125,000 Increase in revenue from new customer acquisition $25,000 $12,000 Customer Perspective Increase customer satisfaction Positive customer survey responses 70% 65% Increase customer acquisition New customers acquired through company sponsored community events 475 350 Internal-Business-Process Perspective Develop innovative services Research and development costs as a percentage of revenue Installation time per customer 5% 6% Increase installation efficiency 5 hours 4.5 hours Increase community involvement Number of new programs with community organizations; 15 Decrease workplace injuries Number of employees injured in the workplace <3 7 Learning-and-Growth Perspective Increase employee competence Number of annual training-hours per employee Number of leadership workshops offered 10 11 Increase leadership skills 2 1 Increase employee safety Percent of employees who have completed safety certification training awareness 100% 95% 12