To briefly describe about the balanced scorecard, I need to look at bigger picture such as a management system to start. A management system is able to the organization to identify, link and influences between its strategy, vision, core values, critical success factors, objectives, performance measures, targets and improvement actions which helps to improve strategic and result of performance. Practicing a balance scorecard is not an easy task. It requires managers to develop a clear vision of the organization, a strategic plan and action. Then finally develop a balance scorecard.
The balanced scorecards is just a framework, so it can be used for many kind of ways of measuring and it doesn't say what the specific measures should be. This flexibility causes problem for organizations because each organization set the measurement different. Designing the scorecard is important and it should be agreed how the measures, the way they are practice and how they are acted upon, within the organization. If company uses alternatives, how it influence to you.
Value Added is the alternative for instance. This overview of corporate measurement can be approach to every business activity. Business decisions require the careful balancing of expected outcomes, costs and risks and fundamental ideas, Relevance and Quality, must be satisfied.
Relevance
The outcome must be relevant for the activity, product, or asset and relevant several focal points as follows;
· The company vision
· The business objectives
· The customer
· The production / delivery process
Quality
Quality must be completed to the specified requirements. If it is below the requirement, need to be reworking or returns cost. It is not to mention lost sales from dissatisfying customers. If it is above the required quality, which means spending time and cost more than necessary. Critical to assessing the required quality are product, process and brand.
Value added is a tool to analysis identifies areas to improve the contribution of time and assets and infuses business activities with positive impact.
The balanced scorecard measures four perspectives such as learning and growth perspective, business process perspective, customer perspective and financial perspective. Each perspectives has same objectives to measure, for example, objectives, measures, targets and initiatives. To score the balanced scorecard is determine the strength and weakness and analyze the outcomes. As you can see, every perspectives and objectives are balanced is an ideal result. I can’t think of any other measures in organization that in fact inhibit organizational or employee effectiveness because the balanced scorecard measure is tend to find strength and weakness point and analyze the outcomes. This is used for the employee or organization to improve their efficiency and effectiveness.
Based on these knowledges, I think different measures influence to you what you do and how to perform because difference measure uses difference point of view of judgment. It could be happened that management strategy is balanced by one measure but it is not satisfied enough by alternatives. In order to get promotion if it is occur based on your performance, I would suggest to determine the way of new measure, how to score and judge to meet what company is looking for. Then change your strategy to fulfill company demand.
http://www.balancedscorecard.org/basics/bsc1.html
http://en.wikipedia.org/wiki/Balanced_Scorecard
http://www.1000ventures.com/business_guide/mgmt_measurement_bsc.html
http://www.webpronews.com/topnews/2002/10/09/demystifying-value-added
2 comments:
Hi Atsuko,
I like your discussion about the balance scorecard because you provide some opinions from different point of view. I agree with what you said that balance scorecard is a framework, and since there is no specific measurement given out, it’s difficult for management to select proper categories. Financial measurements provide specific numbers, so people can compare and judge the “correctness” about the result, but balance scorecard involves more consideration of qualitative factors other than just quantitative factor. I think it is more like a guideline to help manager monitor and measure the progress of achieving the goal of the business operation.
The Balance Scorecard has it’s advantages, but for a short, fast and regular analysis of immaterial values it is far to complex and much to slow. I've tried some practical ways and even try to implement Balanced Scorecard with MS Excel and only find in the end that Balance Scorecard just didn't go far enough to make it a really useful management tool. A scorecard may also lead to counterproductive actions if management decides to 'play the numbers' instead of improving performance. It can tell you the present status of different measures, but it cannot tell you how to achieve better performance.
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