iRobot Balanced Scorecard and Communication Plan
The strategic objectives based on the Balanced Scorecard quadrants were created to meet the vision and mission of iRobot and its innovative product – Helpy100i. In the Shareholder Value and Financial Perspective, the first strategic objective is to reach the acceptable cash inflows to survive at the emerging robotics market with inability to accurately predict the sales and the customers’ behavior. A metric of this strategic objective will be the annual volume of the cash inflow, because it is complicated to set the expectations for the stable quarterly cash flows trends regarding the previous financial analysis of iRobot operations. Therefore, the annual target for the cash flows from operating activities is to reach $11 Mln in the full first year of Helpy 100i sales, 15Mln in the second year of sales, and $17 Mln in the third year of sales.
The second strategic objective in the Shareholder Value and Financial Perspective is to succeed at the consumers’ robotics, in particular health robotics, industry by increasing the sales volume. A metric of this strategic objective will be the percentage of sales growth annually. As the product is new for the market, during the first year of operations it is a need to capture the starting sales figures. During the second year of sales, the annual sales growth is expected to be 5 percent, following by the third year period with an increase by 8 percent.
The third strategic objective in the Shareholder Value and Financial Perspective is related to the increase of market share. Currently, iRobot is one of the robotics brands that the customers know and recognize. The telepresence technology implemented into the highly innovative Helpy100i should make a high resonance at the market. The metric of this strategic objective is the percentage of the market share growth. During the second year of operations the increase in market share is expected to be 10 percent, following by the third year with the increase in market share by 9 percent.
As for the Process or Internal Operations Perspective of the Balanced Scorecard, the first strategic objective is to increase the Return on Investment scores. Regarding the fact that in order to constantly improve Helpy100i to perfectly match it to the current and potential needs of the customers, it is important to receive large volumes of investments. As it was previously mentioned in the SWOT analysis, iRobot experiences a high deficit in investments attracting. Therefore, the target is to reach 13 percent for ROI, regarding that the current ROI for the iRobot operations is 12,23 (iRobot Form 10-K). The second strategic objective is another crucial indicator of the financial performance for investors. It is to achieve high current ratio. With the company’s average 3,80, Helpy100i seeks to reach 3,2 after the first year of sales, and 3,5 at the end of the second sales year. The third strategic objective is to improve the inventory turnover ratio. The target in this strategic objective is 5,5 at …
