Balanced Scorecard: A Strategic Planning and Management Tool

This presentation explains what a balanced scorecard is, its elements, and how it can improve organizational performance. It also recommends that EEC Company adopt the balanced scorecard and provides tips on how to avoid unethical behavior in tying performance measures to compensation.

BALANCED
SCORECARD
Name
Course
Lecturer
Date of Submission

Introduction
 Balanced scorecard can be defined as a
strategic planning and management
tool or system that organizations use to
align their business activities to its
mission, vision and strategies by
monitoring performance hence focusing
in achieving its strategic goals.

Elements that might be present
in a balanced scorecard
 Financial perspective: they are used for
tracking information concerning
financial performance or rather tracking
of financial performance
 Customers perspective: they used for
tracking and determination of customer
satisfaction, attitudes, and market share
goals

How the elements will be used
 They can be used for Business Process
point of view
 They can be applicable when it comes
to a Learning and Growth Perspective.
Learning and growth perspective
revolves around intangible drivers for
future success such as human capital,
organizational capital, training,
informational systems. (Almimar, 2015)

Recommendation of whether or not EEC
should adopt the balanced scorecard
 Yes, the EEC should adopt the balanced scorecard since is
very crucial as management tool which will help the
company in improving its organizational performance.
 It offers an enhancement and improvement to the
traditional way of management planning and control
system by not only considering financial measures but
also by incorporating and advocating non-financial
measures.
 This involves considering the balance between financial
and non-financial measure, between short-term and long-
term objectives, between internal and external
performance perspectives, and between lagging and
leading indicators

How Balanced Scorecard will
improve EEC Company
 By adopting balanced scorecard and
also successfully implementing it, the
company will benefit by having a better
management through understanding
the linkages between specific
company’s decisions and actions, and
its chosen strategic goals.

Unethical behavior that can result if the
wrong performance measures are used to
tie performance measures to compensation
 This is immoral behavior, in which the company must ensure fairness is
provided to every employee while developing a compensation system.
 The compensation system should be reasonable for each employee of
the EEC Company, hence alleviating possibility of the immoral behavior
to be revealed.
 If the system is not reasonably fair to employees, they may work
towards their own personal interests rather than the company’s
objectives.
 In addition, having reduced manufacturing costs in the company is very
vital to the management since it will in turn lead to increased profits.
 However, reduction of costs related to the products being
manufactured should not be of an expense of having low quality
products. This can also be another type of immoral behavior within the
company

How can EEC avoid these behaviors as well as
tie performance measure to compensation ?
 By demonstrating a good leadership
immoral behavior can be eliminated
before taking place in the company.
 Its managers should consider and
embrace creating environment in which
employees will not want to behave
immorally since they don’t want to
damage the image of the company.

Conclusion

References
References
Almimar, Y. (2015). Elements Within Key Performance
Indicators and Balanced Scorecard for IT Operational
Management. IT Operational Management , 7--9.
 Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2015).
Managerial Accounting (15th ed.). 4-26.
 Keel, L. (2011). Performance Measures and Co
mpensation. 3-8.
 QuickScore. (2018, October 28). What is a Balanced
Scorecard? Retrieved from QuickScore:
https://balancedscorecards.com