Implementing Balanced Scorecard for Booktopia

This document discusses the implementation of balanced scorecard for Booktopia, an online bookstore based in Australia. It explores the pros and cons of using balanced scorecard and how it can help enhance the financial figures of the company. The document also provides a step-by-step guide to implementing balanced scorecard and includes a strategy map and individual scorecards for Booktopia.

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Submitted by
5/9/2019

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Contents
Introduction......................................................................................................................................2
Balance scorecard for Booktopia.....................................................................................................3
Pros and cons of balance scorecard for Booktopia..........................................................................6
Pros..............................................................................................................................................6
Cons.............................................................................................................................................6
Implementation of balance scorecard for Booktopia.......................................................................6
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

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Introduction
Booktopia is an online bookstore based in Australia and founded in 2004. It has been identified
that one of the greatest competitors of Booktopia is amazon, who has effectively implemented
balanced scorecard, which is the object for Booktopia to develop and implement balanced
scorecard (booktopia, 2019).
Balance scorecard is a management tool to assess strategy performance, it is a structure used by
managers of the company to have a tracking record of activity execution and to monitor and
control the activities by the staff. Moreover, the consequences of the action to be taken are also
assessing through this tool. The reported purpose is to design and implement balance scorecard
for Booktopia and assess how to balance scorecard perspectives would help to enhance the
financial figures of the company (Zhang & Tan, 2017).

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Balance scorecard for Booktopia
The set of performance and the relevant target related to four major dimensions is balance
scorecard. The four dimensions included financial perspective, internal process perspective,
customer perspective, and learning and growth perspective. This tool considers the company’s
responsibility and target plan keeping specific stakeholders in mind.
Booktopia Balance scorecard
Objectives Measures Targets Initiatives
Financial  Decrease cost
 Increase profitability
 Profit margins
 Revenue
10% and
20%
increase
 Application of
cost
management
 Economies of
scale
 Extensive
promotion
Customer  Customer retention
 Number of potential
customers
 Increased customer
loyalty
 Customer
satisfaction level
 Revenue from
each client
20%
increase
 Implement a
Customer
relationship
management
tool
 Service
improvement
strategy
 Product variety
Business
process
 Delivery service  Technology 20%  Supply chain

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 The agile Supply
chain system
update
 Supplier relations
increase management
 Service
delivery speed
and system
Learning
and growth
 Improved Time
management approach
 Business expansion
 Employees training
program
 Productivity
 Order completion
time
15%,
and
20%
 Time
management
 Training
program
 Implement an
expansion
strategy
The above table presents the balance scorecard design for Booktopia considering the following
four perspectives
1. Financial perspective
This perspective represents the key objective, whose consequences are targeting the
financial aspects of the company. First recommended objective for Booktopia would be
decreased in cost. For gaining better profit margin and for the company to sustain in the
industry it is important for the company to keep the cost to the company lower. The target
by the company considering this object would be a reduction of at least 10 percent cost of
the company, which can be measured through the profit margins of the company, which
must increase to 10 percent. Another objective includes increasing profitability by 20
percent, which can be measured by the revenue of the company. The key action taken by
the company to achieve the financial targets would be promotional activities to increase

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the sale of goods to increase the profitability of the company; economies of scale could
be helpful for the company to reduce the cost of the company. This objective would be
helpful for Booktopia to achieve the key business objective of being the largest online
bookstore in Australia (Andersson, 2016).
2. Customer perspective
It is generally accepted that customer is the most important stakeholders, who are
responsible for the success of the company. This reflects that the number of customers
and customer satisfaction is very important for the company. For Booktopia the
recommended objective would be customer retention, an increase in customer loyalty for
Booktopia, and rapid increase in a number of potential customers (Gong & Yi, 2018).
This can be measured through customer satisfaction level, which can be measured
through reviews on the website and social media reviews or feedback from the customers,
and a customer can measure customer loyalty through revenue from each client and
repetitive purchase. The target of the company is to increase this target by 20 percent
(Chung, 2015)t. The key initiative taken by the company to achieve this target includes
the use of customer relationship management by the company to consider the customer
database and maintain the relationship (Baker & Bowen, 2015). Moreover, the potential
customer can be increased through an increase in product variety that is making a website
helpful for various customer segments, and improve services provided to the customers
or increase the satisfaction level (Dawson & Andriopolous, 2014).
3. Business process
To improve the business process of the company the key objective includes delivery
services improvement and agile supply chain by 20 percent. This target can be measured

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by enhancing supplier relations and updating technology would be helpful for Booktopia
to improve the delivery system. This would be helpful for Booktopia to rectify the issue
faced by the customer that is not got delivery on time and advisable boos were not in
stock, which could be improved through enhancing supply chain and timely stock filling
by the company and reach the customer quickly to reduce delivery days and enhance
customer satisfaction (Chari & Feng, 2018).
4. Learning and growth perspective
The key recommended objective in this criterion would be time management since the
issue raised by the customer is non-availability of products and delay in delivery. The
company can improve the time management system in order to manage work and timely
completion of every task as per the schedule. Employee training program and business
expansion are other objectives to enhance the service provided by the employees to the
customers. This can be measured through the level of productivity and time of order

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completion, for which the target is to enhance the productivity of the company by 15
percent and decrease order completion time by 20 percent (Ahlin, 2014).
Pros and cons of balance scorecard for Booktopia
Pros
 Having a clear picture – While implementing balanced scorecard tool by Booktopia, the
company would have a clear picture of what the company is lagging at and what target is
to be achieved by the company. Moreover, the actions that must be taken are also clear
for senior management and employees of the company.
 Make goals achievable – The goals of the company are aligned with the recommended
objective by balance scorecard and which makes those goals to be achievable in nature
and not vague for Booktopia. For example, Booktopia goal becomes the largest bookstore
in Australia, which became achievable through recommended objectives in Balance
scorecard.
 Easy to monitor and control – Through balance scorecard tool, Booktopia can easily
monitor and control the activities and action taken by managers and employees of the
company and can find the deviations that are the problem can be identified as the way to
measure each objective is also designing with balanced scorecard (Birasnav, 2014).
Cons
 Time-consuming tool – This tool includes time consumed by the authorized person
designing balance scorecard, and the implementation of this tool requires time by all the
employees.

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 Expensive tool – the tool cannot be framed and implemented by any individual, it
requires various resources and skilled man force, which makes this tool expensive for
Booktopia and increase the cost to the company.
 Data mining required – The process of designing and implementation required in depth
analysis and collection of data within the organization (Bruns, 2013).
Implementation of balance scorecard for Booktopia
Implementation of balance scorecard would involve the following stages
Step 1 – Executive commitment and training
The foremost action to be taken for successful implementation of balanced scorecard would be to
ensure that the senior management and executives are committed towards the execution.
Booktopia must consider senior management attitude towards balance scorecard tool and training
would be provided to top level management to effectively execute the tool.
Step2 – Strategy map finalization
This step would include to align the strategy of the company and finalizing strategy map. There
is specific structure to balance sheet or financial information and strategy map is created to keep
the recommended objectives through balance scorecard to be aligned and not found to be
offtrack as the key objective is to achieve goals and strategy of the company.
Step3- Preparation of balanced scorecard

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The third stage would be to actually design and prepare balance scorecard (as presented in table
1 for Booktopia)
Step4 – Individual scorecard preparation
This step would include setting up an action plan or objectives for individuals that is every
employee must have their specific objective contributing to the objective considered in balance
scorecard (Zhang & Tan, 2017).
Step 5 - Gap analysis
The individual performance and individual scorecard are compared and the gap is analysed, in
case of any deviations. This is to analyze the areas which are not working as per the set target or
schedule.
Step 6 – Review process
This is the last stage where the controlling is considered through effective review process. This
would include corrective actions to be taken (Duggan, 2018).

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Conclusion
From the discussing, it can be concluded that Balance scorecard is a management tool to assess
strategy performance, it is a structure used by managers of the company to have a tracking record
of activity execution and to monitor and control the activities by the staff. Booktopia is an online
bookstore that whose goal is to become the largest Australian bookstore brand. Pros of balance
scorecard for Booktopia included make goals achievable, having a clear picture, and easy to
monitor and control. However, key cons of balance scorecard for Booktopia were data mining
required, expensive tool, and time-consuming tool.

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References
Ahlin, B., 2014. Entrepreneurs’ creativity and firm innovation: the moderating role of
entrepreneurial self-efficacy. Small Business Economics, 43(1), p.101.
Andersson, R., 2016. Communication professionals: Important Internal Agents for Realizing
Strategy Processes within the Organization. In ECREA, p.1.
Baker, H.K. & Bowen, H.P., 2015. Globalization and diversification strategy: A managerial
perspective. Scandinavian Journal of Management, 31(1), pp.25-39.
Birasnav, M., 2014. Knowledge management and organizational performance in the service
industry: The role of transformational leadership beyond the effects of transactional leadership..
Journal of Business Research, 67(8), pp.1622-29.
booktopia, 2019. about us. [Online] Available at: https://www.booktopia.com.au/.
Bruns, P., 2013. Corporate Entrepreneurship: Innovation and Strategy in large organisations.
3rd ed. london: Palgrave MacMillan.
Carton, A.M., 2014. A (blurry) vision of the future: How leader rhetoric about ultimate goals
influences performance. Academy of Management Journal, 57(6), pp.1544-70.
Chari, S. & Feng, H., 2018. Research in marketing strategy. Journal of the Academy of
Marketing Science, pp.1-26.
Chung, T.L., 2015. The role of listening in e-contact center customer relationship management.
Journal of services marketing, 29(1), pp.49-58.

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Dawson, P. & Andriopolous, C., 2014. Managing Change, Creativity and Organisation. London:
Sage. Available at: https://www.businessnewsdaily.com/8894-creativity-business-success.html.
Duggan, T., 2018. How to Implement & Manage a Marketing Strategy. [Online] Available at:
https://smallbusiness.chron.com/implement-manage-marketing-strategy-41184.html.
Gong, T. & Yi, Y., 2018. The effect of service quality on customer satisfaction, loyalty, and
happiness in five Asian countries. Psychology & Marketing, p.472.
Zhang, Y. & Tan, Y., 2017. Service performance evaluation using data envelopment analysis and
balance scorecard approach: an application to automotive industry. Annals of Operations
Research, 248(1-2), pp.449-70.

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