$$You know Brian, the shareholders will be watching your every move from here on out,$$ said Rachel Weber, chairman of the board at Delta$/$Signal Corporation and daughter of Louis Weber, who founded the Ohio$-$based automotive electrical supplier in $1992.$The stock keeps slipping, our $2012$ revenues are far below two years ago, material and production costs keep going up$,$ and we continue to lose market share to our competitors. $[$See Exhibit $1$ for competitive summary and Exhibit $2$ for selected financial results vs$.$ competitors.$]$ You may not have much time before the shareholders start demanding your head, the way they rallied against Louis. At the same time, there are still several board members and a lot of longtime employees who thought it was a mistake to ask Louis to step down. They will want to see what kind of results you can deliver.$$ Brian Nielson, who was hired three months ago to replace Louis Weber as CEO, stirred his coffee thoughtfully. $$I realize that whatever short honeymoon period I may have had is probably over now. And I know that our financial results are troubling. $[$See Exhibit $3$ for historical financial data.$]$ But I have been using my time to gather information to craft a strategy for our turnaround. I believe that Louis$$s strategy of being all things to all customers was fundamentally flawed. Did you know we have $2,000$ distinct products? Over the years, whenever a customer asked for something we would do it$,$ regardless of whether it fit in with our capabilities. We have $100$ separate production lines turning out everything from cut$-$rate instrument panel switches to high$-$end state$-$of$-$the$-$art powertrain sensors$.$ We have sufficiently invested in the business to maintain acceptable quality, product performance, and cost competitiveness; however, we are not a leader at anything. We don$$t have a clear, concise message about our value proposition to customers and our managers don$$t have a clear set of goals to work towards. All this leads to substandard results.$$I know,$$ Rachel sighed. $$We should have hired a professional team years ago. Dad was a great visionary, but he wasn$$t cut out to be CEO and my cousin Taryn did not have the experience to be CFO, particularly once the company started expanding into other countries. I think we did the right thing by cutting back on manufacturing costs during the downturn by closing a few U$.$S$.$ and U$.$K$.$ plants, conducting layoffs, reducing our R&D budget, and cutting administrative costs, but now I$$m wondering if we shouldn$$t make new investments for the future. I don$$t want Delta$/$Signal to be left behind when the economy recovers.$$I think it is time we started investing for the future,$$ agreed Nielson. $$But I want to make sure we head in the right direction. We have a good executive team in place now, and I$$ve asked them for their input as I work on crafting a new strategy going forward. I have four possible strategies that I Strategy Simulation: The Balanced Scorecard Delta$/$Signal Corp. $2$ would like to present to the board at the meeting next week: two that would target economy car makers and two that would target luxury car makers.$($See Exhibit $4$ for EVP strategy recommendations, Exhibit $5$ for organizational chart, and Exhibit $6$ for global facilities.$)$That sounds promising, but you must be leaning toward one strategy that you think would be best,$$ prompted Weber. $$Our recent expansion into Asia would support the economy$-$segment strategies,$$ Nielson said. $$Given the state of the world economy, lower priced cars will gain market share for the near future. And the growing middle class in emerging markets like Asia would also point towards pursuing low$-$cost strategies. However, nearly all of our competitors are rushing headlong into Asia because they see the same opportunities. This may leave the luxury OEMs in the United States and Europe up for grabs, and since our traditional expertise has been in R&D$,$ we could capitalize on the lack of competitive interest in the luxury segment. There is also the recent threat that the Chinese government will enact a law requiring OEMs to share technology in order to sell cars in that country. I$$m not sure we should get in a situation where we would be forced to share proprietary technologies.$$ Nielson stood and looked out over the view of Lake Erie from his office window in the company headquarters in Cleveland. $$No matter what strategy we choose,$$ he continued, $$I want to build a strategy map and balanced scorecard to better direct and aid our strategy implementation throughout the company. I have engaged a consulting firm to work with division managers and EVPs to compile a list of objectives, initiatives, metrics, and targets that we could use to populate balanced scorecards and strategy maps. $[$See Exhibit $7$ for a list of suggested objectives and corresponding metrics, and the Appendix for a list of available initiatives with corresponding metrics and budgets.$]$ We should be prepared to commit resources toward the