BSC Adoption for N&S Ltd: Improving Strategic Performance
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AI Summary
This report explores the adoption of the Balanced Scorecard (BSC) by N&S Ltd., a Victoria-based agro-industrial enterprise. The company faced challenges in making its workforce understand the strategic objectives. The report examines the BSC model, business strategy considerations, and its application for N&S Ltd. It also discusses the benefits of using the BSC for performance measurement and alignment with strategic objectives.
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BSC adoption for N&S Ltd
Contents
Background................................................................................................................................1
Introduction................................................................................................................................1
Balance Score Cards..................................................................................................................2
business strategy Considerations................................................................................................4
BSC for N&S Ltd.......................................................................................................................6
Conclusions..............................................................................................................................15
Bibliography.............................................................................................................................15
Contents
Background................................................................................................................................1
Introduction................................................................................................................................1
Balance Score Cards..................................................................................................................2
business strategy Considerations................................................................................................4
BSC for N&S Ltd.......................................................................................................................6
Conclusions..............................................................................................................................15
Bibliography.............................................................................................................................15
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BSC adoption for N&S Ltd
Overview
N&S Ltd. is a Victoria based agro-industrial enterprise that produces car tyres using rubber
latex. The company has 300 people working for the company and it has $3bn is the share
capital. In last couple of years, the company is losing on its performance mainly due to the
differences in the understanding of the strategic picture among the top management and
middle level employees. A survey conducted in the factory discovered that 95% of the people
working in the organization did not understand the strategy of the business. Thus,
organization has planned to adopt Balanced Scorecard tool to record and document business
performance.
This report has been prepared to understand how balance score card is prepared and how it
can help an organization achieve a better strategic performance. The analysis of the BSC
model would be used to understand if the company would be able to resolve its issue of lack
of awareness of the strategic objectives of the company in its workforce or managers.
Introduction
This report explores the process of adoption of BSC for N&S Ltd. The company is facing a
struggle in making its people understand the strategic objectives and plans of the
organization. The report would explore the concept of balanced score casts, business strategy
considerations and application of BSC for the case of N&S limited.
The balance score card model has been adopted by the company to get more transparency
achieved on the strategic front so that managers at all levels in the company are able to
understand the objectives of the company as well as have defined ways for achieving them.
Each of the four perspectives including financial, customer, internal and learning would be
explored to understand strategy considerations that an organisation should have while
preparing BSC. An analysis of the company shall be done where the BSC approach would be
applied to the case of the company to identify strategic objectives and targets that company
can set for its development (Snapka & Copikova, 2011).
Balance Score Cards
A balanced score card is a strategic tool developed by Robert Kaplan and David Norton for
measuring performance of an organization by converting its vision and mission into
operational activities. IT can help understand a strategy used by an organization, explore its
learning processes and define its target.
The actions defined in the BSC have specific indicators that can be used for measuring
operational performance of the organization. Creation of a BSC begins with identification of
Overview
N&S Ltd. is a Victoria based agro-industrial enterprise that produces car tyres using rubber
latex. The company has 300 people working for the company and it has $3bn is the share
capital. In last couple of years, the company is losing on its performance mainly due to the
differences in the understanding of the strategic picture among the top management and
middle level employees. A survey conducted in the factory discovered that 95% of the people
working in the organization did not understand the strategy of the business. Thus,
organization has planned to adopt Balanced Scorecard tool to record and document business
performance.
This report has been prepared to understand how balance score card is prepared and how it
can help an organization achieve a better strategic performance. The analysis of the BSC
model would be used to understand if the company would be able to resolve its issue of lack
of awareness of the strategic objectives of the company in its workforce or managers.
Introduction
This report explores the process of adoption of BSC for N&S Ltd. The company is facing a
struggle in making its people understand the strategic objectives and plans of the
organization. The report would explore the concept of balanced score casts, business strategy
considerations and application of BSC for the case of N&S limited.
The balance score card model has been adopted by the company to get more transparency
achieved on the strategic front so that managers at all levels in the company are able to
understand the objectives of the company as well as have defined ways for achieving them.
Each of the four perspectives including financial, customer, internal and learning would be
explored to understand strategy considerations that an organisation should have while
preparing BSC. An analysis of the company shall be done where the BSC approach would be
applied to the case of the company to identify strategic objectives and targets that company
can set for its development (Snapka & Copikova, 2011).
Balance Score Cards
A balanced score card is a strategic tool developed by Robert Kaplan and David Norton for
measuring performance of an organization by converting its vision and mission into
operational activities. IT can help understand a strategy used by an organization, explore its
learning processes and define its target.
The actions defined in the BSC have specific indicators that can be used for measuring
operational performance of the organization. Creation of a BSC begins with identification of
BSC adoption for N&S Ltd
the vision and the mission of the organization and then the strategy is reviewed from four
perspectives that include customer, financial, internal business, and learning & growth.
Financial Perspective: This perspective explores how attractive an organisation looks to its
investors or shareholders. It makes use of past figures to determine a quantitative benchmark
which reflects upon the operational management and sustainability of an organizational
strategy. The value that is added to a business from the other three perspective is presented in
the form of financial gains and profits that company would receive in this perspective of the
balanced score card. Financial performance measurement can become a common business
language for the company when communicating company performance outside. Based on the
financial performance of the organization, investors and VCs can take a decision on whether
they should invest in the company or not. This perspective can also support decisions of the
shareholders as they would be able to judge if the company has been performing well or not.
The financial measurement only gives the story of what has happened in the organisation but
it does not help in making any future prediction of how company would be performing
financially.
Customer Perspective: This perspective involves exploration of the market needs for
quality, service, products, and price. Organizations try to meet the consumer expectations in
each of these areas to make the business look attractive to them.
Internal Processes: the internal business processes add value to the organizational activities
to support better performance of the organization. This is possible by aligning its processes ,
decisions and activities. This perspective answers the question on what should a company do
in order to satisfy its customers and shareholders.
Learning and growth: An organisation is faced with a dynamic environment in which it is
imperative for it to keep adapting to the changes in regulations, legislations and economic
structures. The long term sustainability of an organization and its ability to innovate is
affected by the company’s capability to continuously keep improving its processes and
systems. This perspective of BSC answers the question on whether the company would be
able to sustain itself for long with the given strategy.
A balance has to be created considering all the four perspectives defined in the balanced
scorecard. This would include considerations of company objectives, financial criteria, non-
financial criteria, leading indicators, lagging indicators, internal perspective and external
perspective. A cohesion is achieved by connecting the four perspectives to create this
balance.
the vision and the mission of the organization and then the strategy is reviewed from four
perspectives that include customer, financial, internal business, and learning & growth.
Financial Perspective: This perspective explores how attractive an organisation looks to its
investors or shareholders. It makes use of past figures to determine a quantitative benchmark
which reflects upon the operational management and sustainability of an organizational
strategy. The value that is added to a business from the other three perspective is presented in
the form of financial gains and profits that company would receive in this perspective of the
balanced score card. Financial performance measurement can become a common business
language for the company when communicating company performance outside. Based on the
financial performance of the organization, investors and VCs can take a decision on whether
they should invest in the company or not. This perspective can also support decisions of the
shareholders as they would be able to judge if the company has been performing well or not.
The financial measurement only gives the story of what has happened in the organisation but
it does not help in making any future prediction of how company would be performing
financially.
Customer Perspective: This perspective involves exploration of the market needs for
quality, service, products, and price. Organizations try to meet the consumer expectations in
each of these areas to make the business look attractive to them.
Internal Processes: the internal business processes add value to the organizational activities
to support better performance of the organization. This is possible by aligning its processes ,
decisions and activities. This perspective answers the question on what should a company do
in order to satisfy its customers and shareholders.
Learning and growth: An organisation is faced with a dynamic environment in which it is
imperative for it to keep adapting to the changes in regulations, legislations and economic
structures. The long term sustainability of an organization and its ability to innovate is
affected by the company’s capability to continuously keep improving its processes and
systems. This perspective of BSC answers the question on whether the company would be
able to sustain itself for long with the given strategy.
A balance has to be created considering all the four perspectives defined in the balanced
scorecard. This would include considerations of company objectives, financial criteria, non-
financial criteria, leading indicators, lagging indicators, internal perspective and external
perspective. A cohesion is achieved by connecting the four perspectives to create this
balance.
BSC adoption for N&S Ltd
For implementing a BSC in an organization, a number of standard steps may be taken. The
first step in this development is the identification of vision, mission and the strategy of the
organization. The defined strategy is then linked to the strategic objectives of the
organization. The management of the organization would have the awareness of the vision,
mission as well as the strategic objectives and thus, their views would be taken by involving
them in a survey or discussion where they can express their views, set up performance
indicators and identify the critical success factors that can affect the business performance.
This involves analysis of stakeholders to understand what their expectations are in terms of
achievement of business objectives.
An inventory of major CSFs is created once they are identified. Critical success factors helps
in establishing indicators that can be used for measuring performance of an organization by
monitoring it throughout. The balance score card implementation also require collection of
performance data related to financial perspective and customer perspectives which is possible
through survey or interviews with shareholders and customers of the company. These
interactions with stakeholders of an organisation can help in understanding what they expect
from the business, its products and services. This can provide a direction to the organisation
in the areas of achievement of the strategic objectives of the organization. When identifying
critical success factors and organisational objectives, middle and senior levels management of
an organisation can be connected to for collecting data for measurement and setting of
targets. Personal objectives of these managers would have to be linked with the
organisational objectives so that they can contribute to the success of the strategy. The
strategic objectives of the organisation are then converted into personal goals of these
managers. For measurement of the objectives, key performance indications are set, values of
objectives is identified and these they are translated into operational activities (Malina &
Selto, 2001).
Business strategy Considerations
BSC model helps organizations measure performance of an organization from different
perspectives to understand the effectiveness of the company strategy in its capability to
achieve the vision, mission and strategic objectives of an organisation. The four perspectives
defined in the BSC involve specific strategic considerations that can affect the performance
measurement. Learning and growth perspective aim to improve the resource knowledge
though training and development activities. Thus, it must allow managers to measure if the
funds invested by them on the progressive development of the workforce has been worth and
have improved communication in the teams (Ram, 2019).
For implementing a BSC in an organization, a number of standard steps may be taken. The
first step in this development is the identification of vision, mission and the strategy of the
organization. The defined strategy is then linked to the strategic objectives of the
organization. The management of the organization would have the awareness of the vision,
mission as well as the strategic objectives and thus, their views would be taken by involving
them in a survey or discussion where they can express their views, set up performance
indicators and identify the critical success factors that can affect the business performance.
This involves analysis of stakeholders to understand what their expectations are in terms of
achievement of business objectives.
An inventory of major CSFs is created once they are identified. Critical success factors helps
in establishing indicators that can be used for measuring performance of an organization by
monitoring it throughout. The balance score card implementation also require collection of
performance data related to financial perspective and customer perspectives which is possible
through survey or interviews with shareholders and customers of the company. These
interactions with stakeholders of an organisation can help in understanding what they expect
from the business, its products and services. This can provide a direction to the organisation
in the areas of achievement of the strategic objectives of the organization. When identifying
critical success factors and organisational objectives, middle and senior levels management of
an organisation can be connected to for collecting data for measurement and setting of
targets. Personal objectives of these managers would have to be linked with the
organisational objectives so that they can contribute to the success of the strategy. The
strategic objectives of the organisation are then converted into personal goals of these
managers. For measurement of the objectives, key performance indications are set, values of
objectives is identified and these they are translated into operational activities (Malina &
Selto, 2001).
Business strategy Considerations
BSC model helps organizations measure performance of an organization from different
perspectives to understand the effectiveness of the company strategy in its capability to
achieve the vision, mission and strategic objectives of an organisation. The four perspectives
defined in the BSC involve specific strategic considerations that can affect the performance
measurement. Learning and growth perspective aim to improve the resource knowledge
though training and development activities. Thus, it must allow managers to measure if the
funds invested by them on the progressive development of the workforce has been worth and
have improved communication in the teams (Ram, 2019).
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BSC adoption for N&S Ltd
For learning and growth perspective, considerations could be job satisfaction among
employees, training opportunities, turnover, knowledge and skills. The company can have a
goal set for employee satisfaction which can be measured using some ranking or scoring
metrics. For instance, employee satisfaction ranking can be establish which would have a
target to score a minimum of 3.5 out of four in employee satisfaction rating. A sporadic rating
can be taken after every quarter or at other frequencies to measure the level of satisfaction
among employees. Staff retention targets can be set in percentages which can help company
measure how effective they have been in retaining its employees by measuring the percentage
of employees that the company was able to retain every year.
The internal processes perspective would need the managers to see how well a business is
performing with respect to products and services of the organization. In the internal business
processes, strategic considerations are made for functional activities, process automation and
process alignment.
To achieve the vision of the organisation, the company should strategically appear to
customers in a positive way. The perspective allows companies to take the marketing oriented
business approach rather than sales oriented which was practiced by traditional organisations.
The organization would aim to create a position in consumers mind so that the consumer
would choose the company over another alternatives when faced with a choice for a product
or a service. Customer perspective includes considerations of customer satisfaction, quality
performance, customer retention, and delivery performance. Customer perceptions about an
organisation can be measured by understanding their loyalty, level of trust in brand, and their
perceptions about reliability of products and services of the company.
Financial perspective of the BSC model can help in judging the performance of the business
in terms of financial metrics to understand business profitability. In financial perspective, key
strategic considerations are returns on investment, cash flow, and financial results.
Use of BSC model for defining measures of performance can bring several benefits to an
organization. These include:
The company would be able have better strategic planning by building powerful
strategic framework for communication and execution. With the use of BSC company
would be able to identify strategic objectives which would drive higher performance
in the workforce for achievement
For learning and growth perspective, considerations could be job satisfaction among
employees, training opportunities, turnover, knowledge and skills. The company can have a
goal set for employee satisfaction which can be measured using some ranking or scoring
metrics. For instance, employee satisfaction ranking can be establish which would have a
target to score a minimum of 3.5 out of four in employee satisfaction rating. A sporadic rating
can be taken after every quarter or at other frequencies to measure the level of satisfaction
among employees. Staff retention targets can be set in percentages which can help company
measure how effective they have been in retaining its employees by measuring the percentage
of employees that the company was able to retain every year.
The internal processes perspective would need the managers to see how well a business is
performing with respect to products and services of the organization. In the internal business
processes, strategic considerations are made for functional activities, process automation and
process alignment.
To achieve the vision of the organisation, the company should strategically appear to
customers in a positive way. The perspective allows companies to take the marketing oriented
business approach rather than sales oriented which was practiced by traditional organisations.
The organization would aim to create a position in consumers mind so that the consumer
would choose the company over another alternatives when faced with a choice for a product
or a service. Customer perspective includes considerations of customer satisfaction, quality
performance, customer retention, and delivery performance. Customer perceptions about an
organisation can be measured by understanding their loyalty, level of trust in brand, and their
perceptions about reliability of products and services of the company.
Financial perspective of the BSC model can help in judging the performance of the business
in terms of financial metrics to understand business profitability. In financial perspective, key
strategic considerations are returns on investment, cash flow, and financial results.
Use of BSC model for defining measures of performance can bring several benefits to an
organization. These include:
The company would be able have better strategic planning by building powerful
strategic framework for communication and execution. With the use of BSC company
would be able to identify strategic objectives which would drive higher performance
in the workforce for achievement
BSC adoption for N&S Ltd
The communication within as well as outside of the company can be improved as the
balanced score card have defined objectives both for internal processes and customer
perspectives which would facilitate effective communication on both front.
The company projects and activities would be better aligned with the strategic
objectives of the organization as the objectives would be well-defined and translated
into specific performance metrics that are actionable
The performance reporting in every major area of business development including
finance, customer, and employees development would be improved with set
objectives for each of these areas
All the business units and the supporting functions could be aligned better with the
balance score card measures so that all the departments and processes of the company
are targeted to achieve common goals
BSC for N&S Ltd
The vision of the company is to become the top player in the tyre sales in coming five years
of the company operations. This vision is planned to be achieved through accomplishment of
a strategic mission which is to grow the customer base every year and achieve greater profits.
The company also plans to create a workforce that is more aware and is clear about these
strategic objectives so that they can help company achieve its strategic objectives by aligning
themselves to the company needs. To be able to do this, the company should identify the
areas of strategy that can play a significant role in company development and communicate
the same to its workforce so that the people can have a clarity on what they are expected to
achieve from their efforts.
BSC model can be used to represent the performance parameters for N&S Ltd for which the
company has to be explored from the four BSC perspectives including financial, customer,
learning and development, and internal processes.
Learning and Development: The learning and development perspective of N&S can have
measurement metrics for each area of employee management and development. It would
involve measurement of the employee related data that can help company assess its business
performance from the perspective. The company can have set goals for major learning and
development considerations. These can be –
The average of the employee satisfaction rating should be more than 3.5 on the scale
of four.
The communication within as well as outside of the company can be improved as the
balanced score card have defined objectives both for internal processes and customer
perspectives which would facilitate effective communication on both front.
The company projects and activities would be better aligned with the strategic
objectives of the organization as the objectives would be well-defined and translated
into specific performance metrics that are actionable
The performance reporting in every major area of business development including
finance, customer, and employees development would be improved with set
objectives for each of these areas
All the business units and the supporting functions could be aligned better with the
balance score card measures so that all the departments and processes of the company
are targeted to achieve common goals
BSC for N&S Ltd
The vision of the company is to become the top player in the tyre sales in coming five years
of the company operations. This vision is planned to be achieved through accomplishment of
a strategic mission which is to grow the customer base every year and achieve greater profits.
The company also plans to create a workforce that is more aware and is clear about these
strategic objectives so that they can help company achieve its strategic objectives by aligning
themselves to the company needs. To be able to do this, the company should identify the
areas of strategy that can play a significant role in company development and communicate
the same to its workforce so that the people can have a clarity on what they are expected to
achieve from their efforts.
BSC model can be used to represent the performance parameters for N&S Ltd for which the
company has to be explored from the four BSC perspectives including financial, customer,
learning and development, and internal processes.
Learning and Development: The learning and development perspective of N&S can have
measurement metrics for each area of employee management and development. It would
involve measurement of the employee related data that can help company assess its business
performance from the perspective. The company can have set goals for major learning and
development considerations. These can be –
The average of the employee satisfaction rating should be more than 3.5 on the scale
of four.
BSC adoption for N&S Ltd
The retention rate of the company should be increased which can be reflected by a
reduction in the employee turnover by 35% in the coming year (Burney & Swanson,
2010).
The company can keep the count of the number of training programs that have been
arranged for its employees over an year
If the employees have been able to develop new skills over an year of their
performance in the company would reveal how effective have been the company in
managing its learning and development programs
If the company has been able to adopt to new technologies that its employees are
using for productivity improvement would reveal how effective the company has been
in developing its workforce and helping it adapt to the changing needs of the market
and the company
Customer Perspective: The customer perspective of N&S can have measurement metrics for
each area of customer acquisition, retention, management and loyalty. It would involve
measurement of the customer related data that can help company understand where it stands
in front of the customer. The company can set goals for major customer considerations. These
can be –
Customer loyalty should be higher than the industry benchmark
The customers should show trust in the reliability and effectiveness of the products
and services of the company which can be measured using a survey conducted to test
customer satisfaction
If the product and service of the company is well matched with the needs of the
market can be an indicator of its performance from the customer perspective
Number of new customers that are gained in the past year as compared to the previous
year can reveal if the company was able to grow its customer base
Number of customers that company has acquired can be measured for each of its
products and services
Market share of the company would reveal where the company stands int eh market as
compared to its competitors
Internal Processes: The internal processes perspective of N&S can have measurement
metrics for each area of internal processes and management. It would involve measurement
of the processes related data that can help company assess its business performance from the
internal perspective. The company can have set goals for important considerations. These can
be –
The retention rate of the company should be increased which can be reflected by a
reduction in the employee turnover by 35% in the coming year (Burney & Swanson,
2010).
The company can keep the count of the number of training programs that have been
arranged for its employees over an year
If the employees have been able to develop new skills over an year of their
performance in the company would reveal how effective have been the company in
managing its learning and development programs
If the company has been able to adopt to new technologies that its employees are
using for productivity improvement would reveal how effective the company has been
in developing its workforce and helping it adapt to the changing needs of the market
and the company
Customer Perspective: The customer perspective of N&S can have measurement metrics for
each area of customer acquisition, retention, management and loyalty. It would involve
measurement of the customer related data that can help company understand where it stands
in front of the customer. The company can set goals for major customer considerations. These
can be –
Customer loyalty should be higher than the industry benchmark
The customers should show trust in the reliability and effectiveness of the products
and services of the company which can be measured using a survey conducted to test
customer satisfaction
If the product and service of the company is well matched with the needs of the
market can be an indicator of its performance from the customer perspective
Number of new customers that are gained in the past year as compared to the previous
year can reveal if the company was able to grow its customer base
Number of customers that company has acquired can be measured for each of its
products and services
Market share of the company would reveal where the company stands int eh market as
compared to its competitors
Internal Processes: The internal processes perspective of N&S can have measurement
metrics for each area of internal processes and management. It would involve measurement
of the processes related data that can help company assess its business performance from the
internal perspective. The company can have set goals for important considerations. These can
be –
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BSC adoption for N&S Ltd
The work that has been completed or accomplished as compared to the planned
schedule of the company can be monitored and measured to understand the potential
of the company’s internal processes to achieve results.
Targets can be set by the organisation for attaining specific time, cost and quality
benchmarks and their measurements over the time would reveal if the company is
able to stay ahead with its internal processes
The resource utilization for the workforce and other tangible as well as intangible
resources can be measured to understand how effectively company is able to use its
resources to achieve organisational objectives.
Company can measure the number of projects that it could complete in a specific
month, quarter or an year which can help measure the ability of the company to
execute projects
Financial Perspective: The financial perspective of N&S can have measurement metrics for
each area of business development. It would involve measurement of the financial data
including turnover, financial statements and profits. The company can have set goals for
these financial considerations. These can be –
Financial position of the company can be judged by measuring the rate of returns it
got from its investments made recently
The company can also measure the profits attained from its current operations to see
how well is the company performing on the financial front
Is the company able to finance its research and development on its own from the
profits gained or would need investments to be made from outside would determine
how well companies strategies have been doing
Is there any significant business that company created from its research and
development activities would reveal how effective is company able to utilize its
investments and get returns (Banwet & Deshmukh, 2006).
Based on the analysis above, a balanced score card can be prepared for the company
highlighting objectives measurements, targets and initiatives for each areas or perspectives of
the balanced score card.
For the learning and development perspectives, the company would measure how company
appears to an employee and if it is able to help them develop and grow in the organization.
The objectives of this perspective would be:
Increase in employee satisfaction
The work that has been completed or accomplished as compared to the planned
schedule of the company can be monitored and measured to understand the potential
of the company’s internal processes to achieve results.
Targets can be set by the organisation for attaining specific time, cost and quality
benchmarks and their measurements over the time would reveal if the company is
able to stay ahead with its internal processes
The resource utilization for the workforce and other tangible as well as intangible
resources can be measured to understand how effectively company is able to use its
resources to achieve organisational objectives.
Company can measure the number of projects that it could complete in a specific
month, quarter or an year which can help measure the ability of the company to
execute projects
Financial Perspective: The financial perspective of N&S can have measurement metrics for
each area of business development. It would involve measurement of the financial data
including turnover, financial statements and profits. The company can have set goals for
these financial considerations. These can be –
Financial position of the company can be judged by measuring the rate of returns it
got from its investments made recently
The company can also measure the profits attained from its current operations to see
how well is the company performing on the financial front
Is the company able to finance its research and development on its own from the
profits gained or would need investments to be made from outside would determine
how well companies strategies have been doing
Is there any significant business that company created from its research and
development activities would reveal how effective is company able to utilize its
investments and get returns (Banwet & Deshmukh, 2006).
Based on the analysis above, a balanced score card can be prepared for the company
highlighting objectives measurements, targets and initiatives for each areas or perspectives of
the balanced score card.
For the learning and development perspectives, the company would measure how company
appears to an employee and if it is able to help them develop and grow in the organization.
The objectives of this perspective would be:
Increase in employee satisfaction
BSC adoption for N&S Ltd
Reduction in attrition rate
Increase in skills gained by employees
The company can measure if these objectives have been achieved by using certain metrics
including employee satisfaction rating, attrition rate, and increase in number of skills that
employees have gained through training programs run in the current year. Then company can
set the targets for each of these measurements based on which company can find out if it was
able to achieve its strategic objectives. These targets can be:
Getting more than 3.4 rating in the customer satisfaction survey on the scale of 0 to 4
Ability to increase the rate of retention and reduce attribution rate by 35%
The company should be able to execute at least 10 training programs throughout the
year that target skill development in employees
To achieve each of these targets, certain initiatives have to be taken by the company
such as –
Implementation of the new employee management systems that can help in better
understanding of employee roles and responsibilities as well as enhance the
productivity of the workforce of the company through automation of some of the
company processes.
To reduce the attrition rate in the organization, the company would have its senior
managers involved in providing motivation to their juniors as well as establish
transparent appraisal systems. The appraisal systems would give an opportunity to the
employees for development in the company
To enhance the skills of the staff, various training programs can be arranged for the
staff based on their training needs and the lack of capability to achieve strategic
objectives of the organisation. For instance, if the employees need to have project
management skills to be able to improve their project performance then company can
arrange for project management training programs for them which would help in
enhancing their skillsets.
For the financial perspectives, the company would measure how company appears before a
customer. The objectives of this perspective would be:
Increase in profits of the company compared to previous year
Returns from the research and development activities
Increase in revenues from sales
Reduction in attrition rate
Increase in skills gained by employees
The company can measure if these objectives have been achieved by using certain metrics
including employee satisfaction rating, attrition rate, and increase in number of skills that
employees have gained through training programs run in the current year. Then company can
set the targets for each of these measurements based on which company can find out if it was
able to achieve its strategic objectives. These targets can be:
Getting more than 3.4 rating in the customer satisfaction survey on the scale of 0 to 4
Ability to increase the rate of retention and reduce attribution rate by 35%
The company should be able to execute at least 10 training programs throughout the
year that target skill development in employees
To achieve each of these targets, certain initiatives have to be taken by the company
such as –
Implementation of the new employee management systems that can help in better
understanding of employee roles and responsibilities as well as enhance the
productivity of the workforce of the company through automation of some of the
company processes.
To reduce the attrition rate in the organization, the company would have its senior
managers involved in providing motivation to their juniors as well as establish
transparent appraisal systems. The appraisal systems would give an opportunity to the
employees for development in the company
To enhance the skills of the staff, various training programs can be arranged for the
staff based on their training needs and the lack of capability to achieve strategic
objectives of the organisation. For instance, if the employees need to have project
management skills to be able to improve their project performance then company can
arrange for project management training programs for them which would help in
enhancing their skillsets.
For the financial perspectives, the company would measure how company appears before a
customer. The objectives of this perspective would be:
Increase in profits of the company compared to previous year
Returns from the research and development activities
Increase in revenues from sales
BSC adoption for N&S Ltd
The company can measure if these objectives have been achieved by using certain metrics
including net profit measurement, return on R&D investments, and increase in company
revenue in the current year. Then company can set the targets for each of these measurements
based on which company can find out if it was able to achieve its strategic objectives. These
targets can be:
Achievement of more than 10% as profits from the operations of the organisation
Getting 30% rate of return from the investments made into research and development
activities
The revenues of the company should increase by 20% as the annual rate of revenue
increase
To achieve each of these targets, certain initiatives have to be taken by the company such as –
To increase profits for the company, the company would use lean practices that would
reduce wastage and thus, reduce the costs incurred in operations of the organisation.
The company can also involve cost control measures and keep monitoring the
utilization of resources so that they can be kept under control and costs are optimized
or minimized
To increase the revenues for the company, the company should be able to sell more in
the market targeting more customers who buy higher priced products or take higher
priced services. Any company would have 80% of its business coming from 20% of
the key accounts that the company should recognize and focus on selling them more
every year to increase its revenue (KAZI, et al., 2011).
To increase the returns from the research and development activities, the company
must ensure that the activities add business value by enhancing its services, adding
new products or generating new revenue streams. With more investment in research
and development activities that have saleable value can gain company more sales and
more revenues and thus, gain significant returns from their investment activities
For the customer perspectives, the company would measure how company appears before a
customer. The objectives of this perspective would be:
Increase in customer satisfaction
Increase in customer loyalty
Increase in customer base
The company can measure if these objectives have been achieved by using certain metrics
including net profit measurement, return on R&D investments, and increase in company
revenue in the current year. Then company can set the targets for each of these measurements
based on which company can find out if it was able to achieve its strategic objectives. These
targets can be:
Achievement of more than 10% as profits from the operations of the organisation
Getting 30% rate of return from the investments made into research and development
activities
The revenues of the company should increase by 20% as the annual rate of revenue
increase
To achieve each of these targets, certain initiatives have to be taken by the company such as –
To increase profits for the company, the company would use lean practices that would
reduce wastage and thus, reduce the costs incurred in operations of the organisation.
The company can also involve cost control measures and keep monitoring the
utilization of resources so that they can be kept under control and costs are optimized
or minimized
To increase the revenues for the company, the company should be able to sell more in
the market targeting more customers who buy higher priced products or take higher
priced services. Any company would have 80% of its business coming from 20% of
the key accounts that the company should recognize and focus on selling them more
every year to increase its revenue (KAZI, et al., 2011).
To increase the returns from the research and development activities, the company
must ensure that the activities add business value by enhancing its services, adding
new products or generating new revenue streams. With more investment in research
and development activities that have saleable value can gain company more sales and
more revenues and thus, gain significant returns from their investment activities
For the customer perspectives, the company would measure how company appears before a
customer. The objectives of this perspective would be:
Increase in customer satisfaction
Increase in customer loyalty
Increase in customer base
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BSC adoption for N&S Ltd
The company can measure if these objectives have been achieved by using certain metrics
including customer satisfaction rating, customer loyalty, and increase in number of customers
in the current year. Then company can set the targets for each of these measurements based
on which company can find out if it was able to achieve its strategic objectives. These targets
can be (Murby & Gould, 2015):
Getting+g more than 9 rating in the customer satisfaction survey
Gaining more loyal customers that can be presented by the number of customers
continuing business with the company from the previous year to current year. This
could be a target of 35% which would be set for customer retention
The number of customers should increase by 20% in the current year as compared to
previous year
To achieve each of these targets, certain initiatives have to be taken by the company
such as –
Implementation of the new customer management systems that can help in better
understanding of customers as well as enhance the customer experience.
TO be able gain more loyal customers, the company can ensure that better services
are provided to them which can be made possible by motivating staff to serve
customer better
To increase the customer base of the company, the company can use marketing to
reach out to more and more customers and then gain more revenues by selling to more
companies its services.
For the internal development perspectives, the company would measure how company is able
to perform well through internal alignment of processes. The objectives of this perspective
would be:
Effective resource utilization
Ability to complete projects within scheduled and assigned budget
Ability to execute more projects than previous year
The company can measure if these objectives have been achieved by using certain metrics
including resource utilization, project performance, and increase in number of projects
executed in the current year. Then company can set the targets for each of these
measurements based on which company can find out if it was able to achieve its strategic
objectives. These targets can be:
The company can measure if these objectives have been achieved by using certain metrics
including customer satisfaction rating, customer loyalty, and increase in number of customers
in the current year. Then company can set the targets for each of these measurements based
on which company can find out if it was able to achieve its strategic objectives. These targets
can be (Murby & Gould, 2015):
Getting+g more than 9 rating in the customer satisfaction survey
Gaining more loyal customers that can be presented by the number of customers
continuing business with the company from the previous year to current year. This
could be a target of 35% which would be set for customer retention
The number of customers should increase by 20% in the current year as compared to
previous year
To achieve each of these targets, certain initiatives have to be taken by the company
such as –
Implementation of the new customer management systems that can help in better
understanding of customers as well as enhance the customer experience.
TO be able gain more loyal customers, the company can ensure that better services
are provided to them which can be made possible by motivating staff to serve
customer better
To increase the customer base of the company, the company can use marketing to
reach out to more and more customers and then gain more revenues by selling to more
companies its services.
For the internal development perspectives, the company would measure how company is able
to perform well through internal alignment of processes. The objectives of this perspective
would be:
Effective resource utilization
Ability to complete projects within scheduled and assigned budget
Ability to execute more projects than previous year
The company can measure if these objectives have been achieved by using certain metrics
including resource utilization, project performance, and increase in number of projects
executed in the current year. Then company can set the targets for each of these
measurements based on which company can find out if it was able to achieve its strategic
objectives. These targets can be:
BSC adoption for N&S Ltd
Most optimum utilization of the available resources in the company with elimination
of any wastages
Completion of at least 80% of the projects within planned timelines and within
assigned budgets
Increase in the number of projects completed in the current year by 20% as compared
to the previous year
To achieve each of these targets, certain initiatives have to be taken by the company such as –
For optimum utilization of resources, the company can track the resources it has and
plan for projects and set priorities based on their availability so that they can be
utilized to their best. The company can also use portfolio management practices to
align different projects and their resources based on priorities set for different
activities. This would ensure that the resources are well utilized on all projects and are
neither too stressed nor underutilized.
To be able to complete all projects on time and within budget, a careful plan would be
made for all projects considering all the project requirements and risks. Stakeholders
can be involved in the requirements gathering stage to ensure that most of their
expectations are considered and take care of on the project such that there are no
conflicts or resistance while executing the project.
To enhance the ability of the company to handle more projects in the year, the
company can improve the speed of its services or hire more people for the job
Conclusions
The report explored the concepts of balanced score card, its strategic considerations and
implementation in practice. A case of Victoria based agro-industrial enterprise that produces
car tyres using rubber latex called N&S Ltd was taken and the model was applied to develop
the scorecard for the company. It was found that BSC helps in measuring the performance of
the company in terms of its ability to achieve the vision and mission of the organisation
through measurements of considerations related to financial, customer, internal, and learning
and development perspectives.
References
Banwet, D. K. & Deshmukh, S., 2006. Balanced Scorecard for Performance Evaluation of
R&D organization: A conceptual model. Journal of Scientific and Industrial Research,
Volume 65, pp. 879-886.
Burney, L. L. & Swanson, N. J., 2010. The Relationship Between Balanced Scorecard
Characteristics and Managers' Job Satisfaction. Journal of Managerial Issues, 22(2), pp. 160-
181.
Most optimum utilization of the available resources in the company with elimination
of any wastages
Completion of at least 80% of the projects within planned timelines and within
assigned budgets
Increase in the number of projects completed in the current year by 20% as compared
to the previous year
To achieve each of these targets, certain initiatives have to be taken by the company such as –
For optimum utilization of resources, the company can track the resources it has and
plan for projects and set priorities based on their availability so that they can be
utilized to their best. The company can also use portfolio management practices to
align different projects and their resources based on priorities set for different
activities. This would ensure that the resources are well utilized on all projects and are
neither too stressed nor underutilized.
To be able to complete all projects on time and within budget, a careful plan would be
made for all projects considering all the project requirements and risks. Stakeholders
can be involved in the requirements gathering stage to ensure that most of their
expectations are considered and take care of on the project such that there are no
conflicts or resistance while executing the project.
To enhance the ability of the company to handle more projects in the year, the
company can improve the speed of its services or hire more people for the job
Conclusions
The report explored the concepts of balanced score card, its strategic considerations and
implementation in practice. A case of Victoria based agro-industrial enterprise that produces
car tyres using rubber latex called N&S Ltd was taken and the model was applied to develop
the scorecard for the company. It was found that BSC helps in measuring the performance of
the company in terms of its ability to achieve the vision and mission of the organisation
through measurements of considerations related to financial, customer, internal, and learning
and development perspectives.
References
Banwet, D. K. & Deshmukh, S., 2006. Balanced Scorecard for Performance Evaluation of
R&D organization: A conceptual model. Journal of Scientific and Industrial Research,
Volume 65, pp. 879-886.
Burney, L. L. & Swanson, N. J., 2010. The Relationship Between Balanced Scorecard
Characteristics and Managers' Job Satisfaction. Journal of Managerial Issues, 22(2), pp. 160-
181.
BSC adoption for N&S Ltd
KAZI, L., RADOSAV, D., NIKOLIĆ, M. & CHOTALIYA, N., 2011. BALANCED
SCORECARD FRAMEWORK IN SOFTWARE PROJECT MONITORING. JOURNAL OF
ENGINEERING MANAGEMENT AND COMPETITIVENESS (JEMC), pp. 51-56.
Malina, M. A. & Selto, F. H., 2001. Communicating and Controlling Strategy: An Empirical
Study of the Effectiveness of the Balanced Scorecard. Journal of Management Accounting
Research, Volume 13, p. 47.
Murby, L. & Gould, S., 2015. Effective Performance Management with the Balanced
Scorecard, London: CIMA.
Ram, R., 2019. Marketing Theories - Balanced Scorecard, s.l.: ISMM.
Snapka, P. & Copikova, A., 2011. Balanced Scorecard and Compensation. Singapore,
IACSIT Press, pp. 43-46.
KAZI, L., RADOSAV, D., NIKOLIĆ, M. & CHOTALIYA, N., 2011. BALANCED
SCORECARD FRAMEWORK IN SOFTWARE PROJECT MONITORING. JOURNAL OF
ENGINEERING MANAGEMENT AND COMPETITIVENESS (JEMC), pp. 51-56.
Malina, M. A. & Selto, F. H., 2001. Communicating and Controlling Strategy: An Empirical
Study of the Effectiveness of the Balanced Scorecard. Journal of Management Accounting
Research, Volume 13, p. 47.
Murby, L. & Gould, S., 2015. Effective Performance Management with the Balanced
Scorecard, London: CIMA.
Ram, R., 2019. Marketing Theories - Balanced Scorecard, s.l.: ISMM.
Snapka, P. & Copikova, A., 2011. Balanced Scorecard and Compensation. Singapore,
IACSIT Press, pp. 43-46.
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