It should be able to in a good position to predict the future performance of the organization, and/or control and manage the organization’s strategic plan. A balanced scorecard is one of best management styles that capture this information in details. This paper gives an analysis of the purposes for non-financial performance measures. It also analyses the current performance measure adopted in Atlantic Tele-Network, Inc (ATN), the extend to which their performance measure captures the Kaplan and Norton’s balanced scorecard and its present strength and weaknesses. Purposes for non-financial performance measure Kaplan and Norton (1996) state that by analyzing the non-financial perspectives of an organization, managers are in a position to translate the strategy of an organization into actionable objectives. It also enables them to get an insight of how the strategic plan of the organization is being executed. According to Kaplan and Norton (1992), a balanced scorecard (BSC) maps the strategic objectives of an organization into performance metrics. This is done in four perspectives namely learning and growth, customers, financial and internal processes. The four perspectives of a balanced scorecard provide important feedback that explains how well the company’s strategic plan is being executed. From this feedback, managers are able to identify necessary adjustments that can be made to ensure that the company achieves its outlined goals and objectives. BSC is a financial and non-financial performance measurement tool. This means that apart from measuring the current performance of a company in terms of finances, a BSC as evaluates the efforts of a firm to make future improvements using customer, process and learning and growth metrics (Niven 2006). As noted in the above discussion, the three major perspectives that make up the non-financial performance measures/BSC of a company are learning and growth, customers and internal processes. According to Kaplan and Norton (2004), an analysis of the objectives of an organization’s internal processes helps the management of an organization to understand and choose type of process that are very important for satisfying its shareholders and most importantly, its customers. Basically, this performance measure outlines the main processes which an organization must focus its efforts for it to excel. An analysis of the learning and growth perspective of a BSC enables an organization to understand how it must learn, improve and innovate for it to achieve its objectives. A significant portion of this perspective is employee-centered. Some of the learning and growth measures will include manufacturing learning, time to market and product focus Douglas (2007). The customer perspective of a BSC enables an organization to understand how it is being viewed by its customers. It also enables it to know how well it is doing in terms of serving its target customers in an effort to meet its financial objectives. The main objectives here will be those that focus on new products, how to become a preferred supplier, becoming a responsive supplier and customer partnerships. Generally, a BSC enables a company to translate its vision into practical goals and adjust its strategy accordingly to the feedback and the learning received. The
Balanced Scorecard Evaluation In order to experience continued growth and improvement, it is very critical that managers of organizations understand their companies from their financial and non-financial perspectives. Kaplan and Norton (1996) state that “if u can’t measure it, u can’t manage it.” This means that managers of organizations should be in a position to keep track of the way the staff execute activities that are within their control…
Balanced Scorecard Approach: A Critical Review (Name) (Tutor’s Name) (Date) Balanced Scorecard Approach: A Critical Review Introduction Balanced Scorecard is a strategic performance management tool, which is mainly used by managers to regulate strategy execution activities and subsequent monitoring processes.
22 Executive Summary In today’s dynamic environment, it is crucial for every organisation to ensure that their performance level is measured from time to time and one of the most effective ways is to use Balanced Scorecard. The scorecard has found to have strategic importance as the card is developed in linkage with the vision and goals of the organisation and adequate awareness is created within the organisation so that every stakeholder is well-aware of the importance of its implementation in the business activities.
Performance measurement tools are also used by organizations to compare the desired performances with the actual performances and then actions can be taken to achieve the desired results by eliminating any kind of discrepancies. Performance management tools are very beneficial for organizations as it allows the management to forecast how the organization has performed and how the organization needs to go in future (Chavan, 2009).
A number of management tools and techniques are used by the management to strategically manage and fulfil the organizational objectives. These are the performance prism, total quality management, value based management and the balanced score card method of which the balanced scorecard technique is the most popularly used management system used in order to improve the performance of the organization.
There have been several studies conducted on the subject of Balanced Scorecard to develop the concept adaptable to the changing circumstances and needs of the organizations. This paper presents some of the facets of balanced score card and an account of the approach in practice.
This objective cannot be achieved unless the company sets specific performance goals and the specific measures to evaluate the level of performance towards the achievement of these goals. As customer satisfaction is the main driver of the organization's profit target, it is of critical importance for the company to enhance its performance level to achieve its goals.
on-financial performance measures to traditional financial metrics to give managers and executives a more balanced view of organizational performance” (Balanced Scorecard Instiute, 2014, par. 1).
The recommended metrics of performance has been divided into four perspectives:
purpose of performance measurement is not only to measure how a business is performing, but also includes the implementation of the performance measurement system in a manner such that the organisation might have better customer experience, employee engagement and stakeholders
The case study identifies key factors that enhance prosperity in colleges and universities:
Moreover, members of the staff should appreciate key positions and departments in the school. The study observes that Individual and
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