Strategy Simulation:

THE BALANCED
FOR COURSES IN:

Strategy

SCORECARD Implementing Strategy

Managerial Accounting

by V.G. Narayanan, Harvard Business School

Strategy Simulation: The Balanced Scorecard

In this multi-player simulation, students experience
the benefits and challenges of using a scorecard
to implement strategic initiatives and monitor firm
performance. Students work together in small teams
to choose a strategy for their company, create a strategy
map, develop a balanced scorecard, choose initiatives to
implement their strategy, and use feedback from the
balanced scorecard to adjust their implementation
approach over time. At the conclusion of the simulation,
each teams company will be purchased by a private
investor. The goal of the simulation is to maximize firm value.

Students must select initiatives that support their companys strategy.

PREREQUISITES AND PLAY

Students should be familiar with the
balanced scorecard concept before
playing the simulation. Although it
can be played by individuals, the
author recommends dividing students
into small teams. Each team will have
1 Data Entry role and 1, 2, or 3 Data
Analyst roles. The Data Entry player
is responsible for submitting
the teams decisions. Due to the
breadth and complexity of the
simulation, the author recommends
allowing students to play 1 or more
practice rounds before making their
final selections. Instructors can do
this by enabling the practice mode.

hbsp.harvard.edu
CREATING A SCORECARD
Students prepare by reading the
Delta/Signal Corp case to learn the
company background. Each team
then creates a unique stock ticker
symbol, chooses a market segment,
and selects 1 of the 4 possible
strategies for their company:
Customer Integration, Product
Innovation, Low Initial Cost, or
Low Lifetime Cost. Students select
objectives and metrics that will
match their chosen strategy and
then create a strategy map.

FUNDING INITIATIVES
The simulation consists of 8 rounds,
each representing 6 months of
elapsed time. In each round, teams
decide which initiatives to fund in
order to achieve their strategic
objectives. Students review the
different options and fund as many The Strategy Map shows the cause-and-effect relationships between objectives.

initiatives as they would like, up to

a $25 million maximum budget.
While the initiative choices from the
previous round automatically carry
over, students can make adjust-
ments based on their analysis of
the results. At the conclusion of the
simulation, the teams company will
be purchased by a private investor.
The buyout price will be based on
the companys financial position and
future prospects.

FINANCIAL AND
SCORECARD DATA
Financial and scorecard metric data is
updated after each simulation round.
Students should analyze this data so
they can determine which initiatives
are creating the desired performance
improvements and which are not.
Students can review the Metric
Dashboard, History, and Graphs
The Analyze screens allow students to determine the success of their initiatives.
screens to perform their analysis.

ADMINISTRATION TOOLS ON NEXT PAGE

Administration Tools for Faculty

A comprehensive Teaching Note covers

key learning objectives. Students will:
 earn how firms use the balanced
L
scorecard to define strategy,
implement strategy, and measure
strategy execution.

 nderstand that a strategy is more

U
likely to be effective if the initiatives
implemented are synergistic with
the strategy.

 xplore how a good balanced

E
scorecard can help companies take
midcourse corrective actions.

 ecognize that financial metrics

R
are often lagging, volatile, and
The Private Equity Valuation debrief screen shows the various buyout prices for the class.
noncontrollable measures of firm
performance.

 xamine the advantages and

E PRACTICE MODE Control group players will not
disadvantages of measuring a Setting the simulation to practice select objectives or see a balanced

MC187560714
small or large number of metrics. mode allows students to play through scorecard, but they will see the
the first 4 rounds repeatedly. Practice financial metrics, and all other aspects
 nderstand how using the
U
rounds allow students to experiment of simulation play will be the same.
balanced scorecard is like financial

Product #M00004
variance analysis extended to with possible choices prior to making
RESULTS SECTION
nonfinancials. permanent decisions for their company.
The instructor results section
 earn how a well-designed strategy
L CONTROL GROUP provides key statistics and graphs

Printed on recycled paper.

map can help managers think Instructors can assign certain student that summarize student performance.
about and communicate strategy. teams to be part of a control group.

Product #114701 | Multi-player | Seat Time: 75 minutes | Developed by Harvard Business School and Forio Online Simulations

PREVIEW AND FREE TRIAL ACCESS ALSO AVAILABLE

Visit hbsp.harvard.edu
A Preview of the simulation is available
on our web site at hbsp.harvard.edu.
A Free Trial allows full access to the
entire simulation and is available to
 inance Simulation:
F
Capital Budgeting #3357
Premium Educator access is a free
service for faculty at degree-granting  trategic Innovation Simulation:
S
Back Bay Battery V2 #7015
institutions and allows access to
Educator Copies, Teaching Notes, Strategy Simulation:
Free Trials, course planning tools, Competitive Dynamics and Wintel #710802

Premium Educators on our web site. and special student pricing.

Customer Service and Tech Support are available 6 am to 8 pm ET,

Monday through Friday, and 9 am to 5 pm ET, Saturday and Sunday.
Customer Service 1-800-545-7685 (1-617-783-7600 outside the U.S. and Canada)
custserv@hbsp.harvard.edu

Technical Support 1-800-810-8858 (1-617-783-7700 outside the U.S. and Canada)

techhelp@hbsp.harvard.edu