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The Interdependency of Brand Value within the Balanced Scorecard

Why do not all Enterprises try to shape their Brands?

Term Paper 2007 18 Pages

Business economics - Controlling

Excerpt

Content

1. Introduction

2. Definition Brand Equity

3. Interdependencies within the Innovation and Learning Perspective
3.1 Innovation & Learning Perspective Matrix
3.2 Innovation & Learning Perspective Matrix Brand Equity interpretation

4. Interdependencies within the Customer and Internal Business Perspective ..
4.1 Internal Business Perspective Goals
4.1.1. Internal Business Perspective Goals Matrix
4.1.2 Internal Business Perspective Goals Matrix Brand Equity interpretation
4.2 Customer Perspective Goals
4.2.1 Customer Perspective Matrix
4.2.2 Customer Perspective Matrix Brand Equity Interpretation
4.3 Interdependencies through both dimensions
4.3.1 Customer and Internal Business Perspective Matrix
4.3.2 Customer and Internal Business Perspective Matrix Brand Equity Interpretation
4.4 Influences on Brand Equity

5. Interdependencies within the financial perspective
5.1 Financial Perspective Matrix
5.2 Financial Perspective Matrix Explanation and Interpretation

6. Summary of Brand Equity Interdependencies

7. Conclusion

References

Table of Figures

Figure 1: Balanced Scorecard Dimensions and Goals

Figure 2: Innovation and Learning Perspective Interdependency Matrix

Figure 3: Internal Business Perspective Interdependency Matrix

Figure 4: Customer Perspective Interdependency Matrix

Figure 5: Internal Business a. Customer Perspective Interdependency Matrix ..

Figure 6: Financial Perspective Interdependency Matrix

Figure 7: Balanced Scorecard with Interdependencies

1. Introduction

Since the 1990s the idea of a balanced score card1 approach and the idea of brand equity have taken the world by storm. Today, the balanced scorecard is widely used by companies for measuring their objects and value management. The idea of brand equity is another idea which becomes more and more important for company success within the last few years. Trusted brands seem to be one way to achieve high market success.2 A few companies like Apple, Audi and Puma could higher their brand equity and improve their financial results enormously. This perception allows a simple question: Why do not all enterprises try to higher their brand value to gain similar success like the above mentioned companies?

This paper tries to approach these questions with an analysis of possible interdependencies which affect brand equity. The balanced scorecard is a proper way to approach this question, because it allows to measure qualitative and quantitative factors which influence brand equity.

The analysis of interdependencies follows the four dimensions which Kaplan and Norten defined in 1996.3 However, the used goals are also influenced by other authors.4 First part of the analysis is a view on the interdependencies within the “innovation and learning perspective” and its influence on brand equity. Then the focus moves to the “customer perspective” and “internal business perspective” and their influence. Both dimensions built the core of each business.5. The last step is a review of financial key data and its influence on brand equity. iii

The following chart illustrates the used dimensions and goals. 13

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Figure 1: Balanced Scorecard Dimensions and Goals

2. Definition Brand Equity

A common definition of brand equity defines brand equity as a reaction of customers on marketing actions which are saved in mind.6 The following paper builds on this idea. The following bullets show the effects of interdependencies within a company on brand equity.

Abbildung in dieser Leseprobe nicht enthalten

3. Manufacturing learning (process time to maturity)

3.1 Innovation & Learning Perspective Matrix

Abbildung in dieser Leseprobe nicht enthalten

Source: Oriented on Kaplan/Norten (1996), P. 85

Figure 2: Innovation and Learning Perspective Interdependency Matrix

3.2 Innovation & Learning Perspective Matrix Brand Equity interpretation

Especially the goal employee satisfaction seems to be important because it affects all processes in a company. Employees are an important stakeholder of each company and influence brand equity significantly.9 Engaging employees in brand changes strengthen the relationship to the company.10 Also, employees can show higher satisfaction if they work for a company with a prestigious brand. However the conditions of work have to fit with this prestigious brand. Otherwise a negative influence on employee satisfaction can be expected because embodiment and reality diverge. Employee satisfaction is highly correlated with their productivity11, what could have influences on brand equity. Higher or lower employee satisfaction could have distinctive influence on the company goals time to market and manufacturing learning. Higher employee satisfaction and productivity would lower manufacturing learning of employees and new product introduction on markets. Higher or lower manufacturing learning and faster or slower new product introduction can have noticeable influence on brand image.

Connections to goals of other dimensions are imaginable. Higher or lower employee satisfaction could hit service quality, productivity and information flow which are all part of the internal business perspective. More satisfied employees show better service quality, higher productivity and share more information. All these factors affect directly or indirectly brand equity.12

4. Interdependencies within the Customer and Internal Business Perspective

Every company is highly influenced by its internal processes and its customers.13 The customer perspective and internal business perspective obey this idea.

[...]


1 Compare to Kaplan/Norten (1992), P. 71

2 Compare to Chatterjee/Chaudhuri (2005), P. 13

3 Compare to Kaplan/Norten (1996), P. 153

4 Compare to Schedl (2002), P. 28

5 Compare to Wang/Wei (2005), P. 1173

6 Esch/Andreasen (1997), S. 13

7 Compare to Zinkin (2006), P. 176

8 Compare to Schedl (2002), P. 28 ; Kaplan/Norten (1993), P. 135

9 Compare to Burkhardt et al. (2005). P. 7

10 Compare to Ochalla/Schmidt (2004), P. 6

11 Compare to Hobbs (1981), P. 70

12 Compare to Burkhard et al (2005), P. 7

13 Compare to Lambert (1999), P. 37

Details

Pages
18
Year
2007
ISBN (eBook)
9783640769278
ISBN (Book)
9783640769414
File size
437 KB
Language
English
Catalog Number
v162870
Institution / College
Zeppelin University Friedrichshafen
Grade
1,3
Tags
Interdependency Brand Value Balanced Scorecard Enterprises Brands

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Title: The Interdependency of Brand Value within the Balanced Scorecard