Many companies do not identify and act on the correct non-financial measures. One of the four major mistakes that companies make is ________.

The correct answer highlights a critical oversight that companies often make in their approach to non-financial measures. Not validating the links refers to the failure to ensure that the non-financial metrics being used can be directly correlated with desired business outcomes, such as financial performance or customer satisfaction. This validation process is essential; without it, companies risk focusing on metrics that do not drive real value or reflect true performance.

For instance, a company might track customer satisfaction scores but fail to analyze how these scores impact sales or retention rates. If the links between non-financial measures and key performance indicators are not validated, organizations may misinterpret data, allocate resources ineffectively, or overlook critical areas for improvement. By validating these connections, companies can create a more comprehensive and effective measurement system that drives informed decision-making and fosters long-term success.

The other options, while they touch on important aspects of business challenges, do not directly address the fundamental issue of ensuring that non-financial measures are relevant and influential to the organization’s strategic goals. This lack of validation can lead companies to misalign their focus and strategies, resulting in poor performance in areas that truly matter.