Based on the information in this entire section, do you feel that these measures are adequate for Store24? Justify your answer.

Store24's Performance Measurement System Store24 's Balanced Scorecard Store24's performance measurement system consisted primarily of a Balanced Scorecard (presented, with metric denitions, in Exhibit 3). As part of its Balanced Scorecard, Store24 collected information on a variety of performance measures at various levels of the organization and at various frequencies throughout the year. Store24 collected storelevel nancial performance metrics on a quarterly basis. These metrics included sales, margin, controllable contribution, and earnings before interest and taxes. Additionally, customer volume was measured quarterly. Semiannually, a thirdparty research rm conducted telephone surveys of selfidentied convenience store customers in Store24's major markets. Survey items included the likelihood of shopping at Store24 rather than its competitors, name recognition of Store24 versus its competitors, and for customers 'dtat had shopped at Store24 recently, ratings of quality of merchandise, price, and cleanliness of the store. Additionally, Store24 solicited feedback via instore comment cards from its customers about the product selection and other factors that would persuade them to shop at Store24. Store24 translated its two strategies into a set of storelevel operating standards. Management measured storelevel conformance with these standards dirough detailed walkthrough audits. During these announced visits, management evaluated the store's performance on various dimensions, including instore image, instock position, and store appearance. The walkthrough audit score quantied the storelevel implementation of Store24's operating strategy. Starting in May [998, die standards reflected both components of the storelevel strategy. Senior and division management considered employee skills critical for consistent implementation of le storelevel operating strategy. Accordingly, Store24 measured manager and crew skills through biannua] evaluations. Finally, Store24 tracked metrics related to its store locations. The measures included 'le number of competing stores within a half-mile radius, the foot trafc, the population density within a halfmile radius, the population within a halfmile radius (divided into prohigh school students, high school students, and college students), the median household income within a halfmile radius, and the percentage of the population within a half-mile radius that held whitecollar jobs. Uses ofrhe Balanced Scorecard Through the Balanced Scorecard. management communicated Store24's operating strategy to employees throughout the organization. The measures and the links between these measures illustrated the qualitative impact that improving a given metric would have on overall company performance. The scorecard served as due centerpiece for quarterly meetings of die senior management team {i.e., corporatelevel and division managers). Each quarter, overall performance on the different perspectives was given a grade of A+f, B+f, C+f, D+.r', or F based on its relation to target. Deviations from the target, both positive and negative, were discussed during the meeting and areas for improvement were identied. The scorecard was used to monitor store performance and was a basis for store-level improvements. Gordon and other senior managers visited each store and met with the store manager at least once per year. During the meeting, they discussed the store's performance on various scorecard metrics, including a detailed review of customer feedback forms. The executive team then devised specific action plans. This process facilitated learning within the organization; senior management learned about new products that might sell well in a particular store as well as new product placement ideas, while the store's manager learned how to improve non-financial metrics such as crew retention and walk-through audit scores. Management also used the scorecard, and specifically the walk-through audit scores, to identify specific stores in need of improvement. Tom Hart, chief operating officer of Store24, believed that low performance on these metrics was a leading indicator of other problems; he used these scores to identify potential future problem areas. Finally, the scorecard was used as a motivational tool. Both store manager and crew compensation were tied to balanced scorecard metrics. The store managers' quarterly compensation consisted of a fixed base salary and a variable portion tied to store operating profits, the walk-through audit score, a separate score related solely to the implementation of Ban Boredom, and crew retention. Specifically, store managers had preset goals on each of these dimensions and could receive up to 20% of their quarterly salary as a bonus, depending on the attainment of these goals. Additionally, each manager received 3.5% of weekly store operating profit as part of their weekly paycheck. Store24 awarded store crew (i.e., non-management) a quarterly bonus of up to $100 based exclusively on the walk- through audit score and Ban Boredom implementation. Through the scorecard use, management hoped to get employees to identify with Store24's overall strategy. Management created the "President's Club," an annual competition in which store managers were rated on their performance on scorecard metrics. The rankings were posted each quarter and the top four managers at year-end were presented with a certificate at an annual Store24 function and a paid vacation to a mountain resort in New England