Strategy, Resource-Capacity Planning, and Time-Driven ABC (TDABC) Obtain and read the following article: Robert S. Kaplan and David P. Norton, “Mastering the Management System,” Harvard Business Review, January 2008, pp. 63–77 (available at: ftp://public.dhe.ibm.com/software/ data/sw-library/cognos/pdfs/whitepapers/wp_mastering_the_management_system.pdf). The authors of this article propose a five-stage management system designed to balance strategy and operations—that is, short-term operational concerns with long-term (strategic) priorities. [Note: The following additional source, available for download from the Harvard Business Publishing website, may also be helpful: Robert S. Kaplan, “Resource Capacity Planning in the Strategy Execution System,” Balanced Scorecard Report, Reprint No. B0809A (2008).]
Required After reading the above-referenced article(s), respond to the following questions:
1. Provide an overview of the five-step cycle that comprises the (strategic) management system proposed by the authors of this article. 2. Stage 3 of the proposed (strategic) management system focuses on “Plan Operations,” a significant component of which deals with planning resource capacity. Describe the process of resource-capacity planning within the context of the five-stage (strategic) management cycle proposed by the authors. In particular, discuss the strategic importance of managing the linkage of Stage 3 to both Stage 2 and Stage 4 of the proposed management cycle. 3. The authors indicate that their preferred tool for resource-capacity planning is time-driven activitybased costing (TDABC). Provide a brief overview of TDABC, including how this implementation differs from traditional ABC models. (Hint: In addition to the article, refer to Chapter 5 of the text.)
4. Refer to the Towerton Financial example presented in the article. How did this organization use TDABC results to determine the level of resource capacity (people and computing) needed to implement its strategy?