Implementing Balanced Scorecard for Harry Rosen Inc

The report discusses the implementation of balanced scorecard for Harry Rosen Inc, a clothing business in Canada. It identifies the outstanding issues of the organisation and provides solutions to overcome them. The report also includes an implementation plan and references.

Running head: ADVANCEDMANAGERIAL ACCOUNTING
Advanced Managerial Accounting
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

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Table of Contents
Executive Summary:........................................................................................2
Outstanding issues of the organisation:..........................................................3
Solution to the identified issues:......................................................................4
Implementation plan:.......................................................................................5
References:....................................................................................................10

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Executive Summary:
The report sheds light on the provided case information of Harry
Rosen, which is deemed to be involved in the clothing business in Canada for
several decades. The main products sold by the organisation include sport
jackets and suits. Harry Rosen Inc is committed to provide effective customer
service. The organisation depends on one-to-one sales approach, in which
the customers are boosted in booking an appointment with a sales associate
for enabling them to undertake purchase decisions.
It has been identified that Harry Rosen follows traditional performance
measurement systems and for overcoming the shortcomings of the
traditional performance measures, balance scorecard is deemed to be the
most effective solution. This system includes both financial and non-financial
measures, which assist in providing a balanced overview of the overall
organisational performance. This is because it concentrates on four different
perspectives that would assist the organisation in fulfilling its financial goals
as well as the other business goals. Thus, it could be inferred that by
implementing the balanced scorecard system, Harry Rosen would be able to
deal with its business issues effectively and corrective actions could be
undertaken for improving the overall position of the organisation in the
Canadian market.

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Outstanding issues of the organisation:
As identified from the case study, there are certain outstanding issues
inherent in Harry Rosen Inc and they are enumerated briefly as follows:
Customer relationship management:
Harry Rosen Inc is committed to provide effective customer service.
The organisation depends on one-to-one sales approach, in which the
customers are boosted in booking an appointment with a sales associate for
enabling them to undertake purchase decisions. However, this system could
suffer from a variety of issues. For instance, it might happen that during an
appointment with a customer, there is a chance that the sales associate
might have to leave the customer for accessing information on a workstation
at the other store end(1).
Traditional financial performance measures:
It has been identified from the provided case information that Harry
Rosen focuses on traditional financial performance measures like sales
growth and profitability. However, it is to be borne in mind that these
traditional measures are focused on short-term. Most of the business
organisationsgather information that includesoperational and financial
statistics(2). In addition, traditional measures depend on irrelevant and
outdated principles and lack of relevance to the modern business
environment demands. Finally, as the traditional performance measures
focus more on revenue and cost data, Harry Rosen could not be able to

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concentrate more on the process. In most occasions, such data provide
misleading or irrelevant information(3). The measures containing bottom line
financial outcomes have been too slow in undertaking necessary corrective
actions.
Solution to the identified issues:
In order to improve the customer relationship management, Harry
Rosen Inc needs to adopt target-based resource allocation. It is a universal
fact that 70%-80% of business profit is generated with the help of 20%-30%
of the total customers(4). As per the case information, the organisation is
involved in using tools of data analysis from Cognos Inc developed into a
GERS Inc merchandising system. Therefore, it is crucial to utilise this tool to
gain an overview of the most potential customers. Such tracking, with the
help of the aforesaid software, would help the organisation in distributing
resources in a way that those customers receive the best services. This could
be adjudged as target-based allocation and this would prove to be beneficial
for the business organisation(5).
For overcoming the shortcomings of the traditional performance
measures, balance scorecard is deemed to be the most effective solution.
This system includes both financial and non-financial measures, which assist
in providing a balanced overview of the overall organisational performance.
Balanced scorecard takes into consideration the changes in the

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contemporary business environment, which include intangible assets and
these are identified to be the primary source of competitive advantage(6).
With the help of such integrated system of strategic management,
Harry Rosen could be able to align the business activities to the
organisational strategy by associating performance measurement with the
strategic objectives of the organisation. More precisely, it provides a
framework in translating the strategy of the organisation into particular
objectives of quantifiable performance that could be gauged effectively(7).
The performance objectives are gauged utilising the four inter-related
objectives, which include customer perspective, financial perspective,
internal business process perspective and learning and growth perspective.
The detailed implementation plan of the system has been discussed in the
following section.
Implementation plan:
In order to implement the balanced scorecard in Harry Rosen Inc, the
management accountants need to follow the below-stated steps in the
above-mentioned four perspectives:
Financial perspective:
Harry Rosen considers sales growth and profitability as the important
financial factors. Thus, it needs to focus on its return on capital employed as
well by maintaining at least 12% within three years. Therefore, in order to

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ensure profitability theme, asset intensity and cost minimisation needs to be
provided adequate importance. In order to measure cost minimisation,
operating cash expenses could be contrasted with the industry for becoming
the cost leader in the sector(8). On the other hand, asset productivity would
assist Harry Rosen in managing greater volumes from the growth strategy
without diversifying the asset base.
A significant component of the organisation has been customer-driven
strategy developed around sales related to convenience store products. The
revenues could be generated from the other products of the organisation as
well. This implies the presence of clear risk, as growth and profitability in
combination might cause the organisation to fall back to a simple
dimensional behaviour. With the help of balanced scorecard, Harry Rosen
could be aware of the trade-offs and accordingly, it could manage them.
Customer perspective:
As Harry Rosen focuses on profitable growth strategy, the executives
of the organisation might express divergent opinions regarding its selling
strategies. It has been observed that majority of the customers of Harry
Rosen have been male aging 39 years. These include moderate to high
income levels having brand loyalty and sometimes to a specific situation, the
customers purchase the products and pay in cash. However, for the price
sensitive customers, the organisation needs to minimise its costs across the

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value chain including the stores in order to maintain profitability even at the
minimum prices charged to the customers.
Alternatively, Harry Rosen could undertake efforts for drawing the
younger customers by proving an effective purchasing experience. For
ensuring this objective, the organisation needs to invest in its various stores
by providing training to the sales personnel. However, such strategy would
increase store costs along with hindering the organisation from making more
profits(9). Another alternative for Harry Rosen would be to contemplate the
distribution system for fulfilling the needs of the younger customers.
Therefore, the following facilities need to be provided to the customers
visiting the stores of Harry Rosen:
 Immediate access to the products
 Complete availability of all products, especially premium grades
 Satisfactory exterior store appearance
 Convenience stores stocked with high quality and fresh merchandise
 Friendly staffs
Internal business process perspective:
For Harry Rosen, it is necessary to create new clothing products for
attracting different customer segments. This objective implies the desire of
improving the purchasing experience of the customers by establishing new
offerings at its convenience stores(10). Another goal would be to support the
win-win association with the financial objectives and dealers of the

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organisation. Along with these objectives, it is necessary for Harry Rosen to
undertake certain measures like consistent quality, stressed low cost,
minimisations of asset downtime and mitigation of safety, environmental and
health-threatening incidents. Majority of these measures are associated with
cost minimisation and profitability themes in the financial perspective.
However, as Harry Rosen mainly sells clothing products, it is not possible for
the organisation to utilise higher process for recovering greater costs
invested in manufacturing and distribution operations. Hence, Harry Rosen
needs to adopt an operational excellence strategy in its primary operating
processes.
Learning and growth perspective:
This is the final group of objectives in the balanced scorecard, which
include motivation and skills of the staffs along with the role of information
technology(11). In order to ensure this perspective, three strategic goals are
identified and they include the following:
1. Core competencies and skills:
 Boosting and motivating 700 staffs working in Harry Rosen for
obtaining a wider insight of marketing and refining business
 Developing the skill and competency levels crucial for executing the
vision of the organization

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 Creating the leadership skills necessary for articulating vision,
promoting integrated business think and developing the staffs(12)
2. Access to strategic information:
 Formulation of strategic information needed for executing the
strategies of Harry Rosen
3. Operational engagement:
 Allowing the achievement of the vision of the organisation by
encouraging an understanding of the organisational strategy and by
establishing an environment where the staffs are motivated to thrive
towards that vision
Hence, by implementing the above-stated measures, Harry Rosen would
be able to deal with its business issues effectively and corrective actions
could be undertaken for improving the overall position of the organisation in
the Canadian market.

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