1.

What was the initial attraction of the Balanced Scorecard concept,

and who drove the adoption?

The initial attraction is that the need of a system which top level of
management of Sereno (Executive Committee) could use to evaluate
performance of the overall units in both short and long-term. In the case of
Serono, they basically tried to consolidate Serono to be one of the worlds top
three biotechnology companies. In order to achieve it, Serono stated
principles supporting strategic intent such as maintaining investment of R&D,
spirit of entrepreneurial and pioneering, being leading-edge in technology,
expanding growth by penetrating wider market, and developing the best
talent. Thus far, Serono aimed to measure overall strategic goals beyond just
financial success. Financial statement seldom captured the diverse and long
standing initiatives to reposition achieve leadership in the biotechnology
industry. Furthermore, lead time of approval is biotech industry is extremely
long. Thus it is critical to make a system the Executive Committee (EC) could
use to evaluate their short and long-term performance.

The one who drove the adoption is Ernesto Bertarelli who look for a
measurement system EU could use to evaluate and was implemented by
small team headed by Andrew Gillbert from Strategic Business Planning
Department

2. What was your assessment of Exhibit 3, The North American

Commercial Balanced Scorecard? Give your specific recommendation
to improve the scorecard?
Existing balance score-card (financial-based) are as follow:
1. Becoming #1 in each of our chosen Therapeutic Area
- Maximize total Serono sales performance
- Glow global market share in each Threpeutic Area
- Maximize free cash flow generated by the group

2. Building superior company to work for

- Commercial Excellence and Alignment of Human and Financial Resources
behind revenue generating activities and resource allocations
- Leadership skills and management competencies
The existing balance score-card focuses on financial perspective, mainly on
sales-growth only in which it should have been added productivity strategy
(cost reduction), customer perspectives, internal perspectives, and learning
and growth perspectives. Thus, the Balance Scorecard in Exhibit 3 requires
little modification. The modification is constituted by several assumptions
such as:
- Leading-edge technology
- Launching innovative products every year
- Producing unique products
- Creating preferred partnership with customers, patients, physicians, and
payers
- Improving entrepreneurial spirit
- Improving working capital
- Focusing on niche market
Thus, additional balance score-card will be:

Perspectives Key Performance Definition

Index
Financial Productivity Strategy The presence of
technology would
Customer Price enable the company to
generate efficient
Quality production

Service Sales service and after

sales service

Partnership Serono committed to

create strategic
partnership with
patients, physicians,
and other customers.

Brand Serono aimed to be

leading-edge and
consolidated its
position to be worlds
top three
biotechnology
companies

Internal Innovation Process The company currently

becomes multiple
products of
biotechnology by
leveraging the
companys scientific
know-how.

Marketing Process The company aimed to

penetrate wider global
market

Operation Process Providing multiple

products with
affordable price and
 high quality

Customer Process Supporting partnership

Learning and Growth Human Capital The company aimed to

become superior
Organizational Capital company to work for by
providing training and
development for the
best recruited talent

Information Capital Hyperion Database