Management Approaches: Benchmarking and Balanced Scorecard Report

This report critically assesses the application of two key management approaches, benchmarking and the balanced scorecard, within the retail industry. The report begins with an executive summary outlining the core purpose: to evaluate how these approaches contribute to organizational well-being and sustainable business excellence. It then delves into the specifics of each approach. The balanced scorecard is examined as a framework for evaluating employee performance, with a focus on its implementation within retail companies like Tesco. The report explores how the scorecard helps in strategic planning, performance measurement, and alignment of efforts with strategic visions. The second framework, benchmarking, is analyzed for its role in improving sales operations and gaining a competitive edge, emphasizing the importance of aligning management objectives with performance benchmarks. The report provides examples of how these approaches can be utilized, and discusses the benefits of each, including a critical review of the potential limitations and challenges of each approach. The conclusion summarizes the key findings and offers recommendations for the effective use of these management tools within the retail sector. The report references academic research throughout to support its analysis.

Running head: MANAGEMENT
Management
Name of the Student
Name of the University
Author Note

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Executive Summary
The overall purpose of the following report is to measure how the two management approaches
like the benchmarking and balanced scorecard will effectively contribute to the overall well
being of the organization. The organizations definitely want some ways through which they can
benefit in the most ways and their profits can grow. In order to do this, they must find out their
flaws and align their efforts with their strategic vision. These factors have been discussed and the
use of these two management approaches has been done in the light of the retail industry. Some
examples from the organizations have been highlighted in this discourse as well.

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Table of Contents
Introduction......................................................................................................................................3
Framework One...............................................................................................................................3
Balanced scorecard......................................................................................................................3
Framework Two...............................................................................................................................6
Benchmarking..............................................................................................................................6
Conclusion.......................................................................................................................................9
Recommendations............................................................................................................................9
References List..............................................................................................................................11

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Introduction
The management approaches are very crucial for the organizations to implement and
become successful in their ventures. The retail industry is regarded as one of the largest
industries in the world and much experimentation has taken place in order to fix the different
issues within the industry (Hansen and Schaltegger 2016). The primary headache of the
organizations is to run the organization in a manner that they can evaluate the performance of
their employees and make recommendations on how the entire situation can be improved.
The importance of the management approaches is huge in this discourse and managers
must address this issue in the most positive manner. The implementation of these two
management approaches namely benchmarking process and the use of the balanced scorecard
will be discussed in this paper to address the issue of organizational success. The organizations
working within the retail industry often tend to use these management approaches so they can
come up with the most fitting solutions for the overall success of the organizations.
The primary aim of the organizations would be the sustainable business and this will
cater to the overall success of the organization by all the means. In this report, the applications of
these two processes in the retail industry will be highlighted and the gaps will be highlighted as
well.
Framework One
Balanced scorecard
Before progressing with the applications of this framework of balanced scorecard, one
must understand the importance of this particular approach. Balanced scorecard is a very
important and effective framework through which the overall performances of the employees

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could be evaluated (Hansen and Schaltegger 2016). The human behaviors of the employees
should be understood to take the decisions on how the particular employee can improve his or
her performance level. The retail industry is a very wide ranging and unique industry in which
the organizations will have to go through a wide range of works. The people working in the retail
industry should be able to understand different types of works and they should be able to take the
best actions within the organization so they can organize themselves and work for the overall
betterment of their performance (Perkins, Grey and Remmers 2014).
In order to understand how the employees can improve their importance, they should
always understand the working procedure of this management approach named balanced
scorecard. The companies in the retail industry at first identify some of their faults and realize
their responsibilities to curb those certain issues. In this scenario, they will take some steps that
will be effective to deal with that issue. Rather they will use this balanced scorecard through
which they will always use this visual tool named the balanced scorecard. When the companies
take some certain steps, they should also measure how much effective this has been in their quest
to become the leading company in the industry (Niven 2014).
The strategic plans should be implemented by the company and these strategic plans
should always help to overshadow the complications and problems. The balanced scorecards are
used by the visionary managers to see if their plans are effective enough to have a deep positive
outcome on the profits. Apart from the success of the plans and visions, companies should also
think about its impact on the society as well (Perkins, Grey and Remmers 2014). The managers
always want to be sure that their strategic plans and visions are in line with the efforts of the
company (Cooper, Ezzamel and Qu 2017). Therefore, they do not want to spoil their efforts by
not aligning it with their strategic vision.

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This scorecard had been implemented within the business to ensure that their efforts were
not bound only within the spheres of the costs, profits and generation of revenues. Keeping all
these things in their minds, they went on to make proper evaluations of their efforts (Zizlavsky
2014). This kind of evaluation has been seen among the efforts of the retail industry
organizations as well. They will look to use this approach to look at their stand in the industry
and how can they compete with their rivals to earn the top spot (Cooper, Ezzamel and Qu 2017).
Retail companies like Tesco in UK have addressed the need of using the balanced scorecard for
their performance evaluation and see if they are on the right track to achieve the organizational
success. The company is of the opinion that they should be able to measure the rate of their
improvement and only then they could find out how they can make more efforts to achieve their
targeted place (Cunha Callado and Jack 2015).
The strategy of the organizations could be utilized through this balanced scorecard in the
retail industry while this approach has some important columns to fill out. The main elements of
this scorecard are objectives, measures, targets and initiatives. These four elements are based on
the four sections of their business (Cunha Callado and Jack 2015). These are financial
operations, customer, business of the internal operations and the growth and learning for the
managers. The managers will be able to present an optimal performance through the use of the
balanced scorecard for their organization. The financial metrics will be taken care of along with
the betterment in their operational performance as well (Gamble, Peteraf and Thompson 2014).
The managers will be able to gain an idea on how they should be able change their perceptions
and ways of thinking towards day to day operations.
The retail organizations like Tesco and Woolworths used this balanced scorecard to find
out the problems within their organizations and they had to solve it. Keeping this aim in their

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minds, they went out to discover the viewpoints or feedbacks from the financial perspectives and
the customer perspectives. Both these perspectives will help out the organization to make some
changes within the organization so they can gain the proper success (Gamble, Peteraf and
Thompson 2014). Both the organizations understood that they must innovate new ways of
satisfying the needs of their customers.
Only in this manner the organizations will be able to get the priority from the
perspectives of the customers. There might be some negative points as well. It is because
balanced scorecard is not able to find out the gaps in the performance of the individual
employees (Aly and Mansour 2017). Rather this approach will bring out the successes and
failures of the collective efforts of the company. The customer perspectives should be aligned
with the ones from the financial sections. Only then the customer satisfaction and financial
profits will be aligned with each other. Critics believe that this approach will help out the retail
industry organizations and help them to bring out their best as well (Zizlavsky 2014). This is
why the balanced scorecard will be a preferable option for the retail organizations all over the
world.
Framework Two
Benchmarking
The sales operations have become a very important matter in terms of the better
performance for the retail industry organizations. The performance of the retail industry
organizations often depend on the overall complications in their sales, functional operations,
management problems and many others. Through the benchmarking process, people will be able
to understand what measures are needed by the organizations to improve their overall

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performance and cater to the overall success (Aly and Mansour 2017). The best performance can
be achieved by the organizations if they effectively implement this benchmarking process within
their management and operations (Gopalan, Sreekumar and Satpathy 2015). Through the use of
this process, the company will be able to gain the competitive advantage over their rival
companies. Companies in the retail industry will like to attain a benchmark in their performance
and try to obtain this in order to make the most of their opportunities (Mhatre, Joo and Lee
2014). The objectives of the management and their efforts should always be aligned with the
benchmark. Through the benchmarking process, the benchmarks can be achieved by the retail
industry organizations. The people involved in the retail industry always strive to do better and
gain better outcomes for their organizations. In this manner, they will need to see some sections
in which they will have to do very good (Gaur and Kesavan 2015).
The retail industry should implement the benchmarking process within their operations
since they have to develop on their overall performance from all the viewpoints. There are
generally four sections in their operations in which they will have to develop and apply the
benchmarking process. These are the effectiveness in their management, marketing process, sales
and their merchandizing (Madsen and Walker 2015). This is why the retail organizations must
seek the proper ways in which they will be able to go through their daily operations and make
recommendations to develop their effectiveness. The critics are of the opinion that they should
look into the factor of product development because it affects their market effectiveness in a
large manner (Gaur and Kesavan 2015). The retail organizations will surely increase their
incremental sales and look for the opportunities on how they can be in the centre of the
marketing among all their competitors. In the case of management effectiveness, the

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organizations should determine if the investments made on their business are effective and
sufficient for their business (Namada 2018).
They should set the benchmark before themselves that they should invest a percentage of
their money for the better effectiveness in their marketing operations (Namada 2018). The ways
of performance by the other retail business organizations will also set the overall benchmark for
the organization. The measurements should always be made on the growth rate of the
organizations. In this manner, the organizations should be able to understand in what ways they
will need to improve (Madsen and Walker 2015). The retail industry organizations will be able to
focus on some of the issues in order to improve the performance of the organization. These
sections are:
 Marketing activities as per sales
 Sales overhead percentage
 Margin of operations
 Sales on the basis of the investments on the working capital
 Capital on the basis of return on investment
 Sales on the basis of the employee per hour
Basically, all these parameters will add up to the performance of the retail organizations. On
that scenario, the external and internal environment of the organizations should be made
responsible for the way they will conduct their business operations (Wagner and Hollenbeck
2014). The improvements should be done on these measures and the organizational managers
should take up their responsibilities in this scenario. The cost savings should be properly utilized
in this case and the benchmarks can be achieved through the proper effectiveness.

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These benchmarks should be set before them and proper steps should be taken on how they
could measure their performances. The performance measurement can be done on hourly,
weekly, monthly or yearly basis (West, Ford and Ibrahim 2015). This is how their bottom-line
profits can be improved in large manner as well. The effectiveness of their merchandizing
process can also be felt in different ways as well. The improvements will thus be made in the
proper ways because the organizations will surely look to develop on their past records in the
best manner (West, Ford and Ibrahim 2015). This is how their industry standards will increase in
various ways as well. The benchmarking data should be utilized for the future progress of the
retail industry organizations.
Conclusion
On a concluding note, it can be said that the development of the organizations will
depend on the ways they measure their failures and cater to the betterments in their own ways.
The retail industry organizations have to go through several fundamental functions and two of
the most important are marketing and financial activities. This is why the organizations in the
retail industry should always tend to use the benchmarking and balanced scorecard method.
These two management approaches will lead to the betterment of the organizations in various
ways. The organizations should think of the ways in how they can measure their current stand
and make the aim where they want to be. Keeping this mind, they have to improvise their
strategies and see if all their strategies are working effectively indeed.
Recommendations
 The benchmarking method will slowly provide the retail industry organizations with the
idea that they will be able to work under the complicated business scenarios and find out

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their problems. These problems can be overcome once they are able to make the use the
benchmarking process. Until they fix a benchmark for themselves, they will not be able
to work effortlessly to achieve that target.
 Balanced scorecard use is also very important management approach and the retail
organizations must find out their opportunities for the organizational learning and
chances for their growth. They have to increase their profit margins so they can invest
more money for their marketing effectiveness.
 Big retail industry organizations like Tesco and Woolworths should take the necessary
steps of using the balanced scorecard so they can innovate new products and services and
cater to the needs of their customers. These steps will obviously be helpful for them to
overcome all the obstacles. Employee benefits will also be looked after in this measure as
well.

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References List
Aly, A.H. and Mansour, M.E., 2017. Evaluating the sustainable performance of corporate
boards: the balanced scorecard approach. Managerial Auditing Journal, 32(2), pp.167-195.
Cooper, D.J., Ezzamel, M. and Qu, S.Q., 2017. Popularizing a management accounting idea: The
case of the balanced scorecard. Contemporary Accounting Research, 34(2), pp.991-1025.
Cunha Callado, A.A. and Jack, L., 2015. Balanced scorecard metrics and specific supply chain
roles. International Journal of Productivity and Performance Management, 64(2), pp.288-300.
Gamble, J.E., Peteraf, M.A. and Thompson, A.A., 2014. Essentials of strategic management:
The quest for competitive advantage. McGraw-Hill Education.
Gaur, V. and Kesavan, S., 2015. The effects of firm size and sales growth rate on inventory
turnover performance in the US retail sector. In Retail Supply Chain Management (pp. 25-52).
Springer, Boston, MA.
Gopalan, R., Sreekumar. and Satpathy, B., 2015. Evaluation of retail service quality–a fuzzy
AHP approach. Benchmarking: An International Journal, 22(6), pp.1058-1080.
Hansen, E.G. and Schaltegger, S., 2016. The sustainability balanced scorecard: A systematic
review of architectures. Journal of Business Ethics, 133(2), pp.193-221.
Hinterhuber, A. and Liozu, S.M., 2017. Is innovation in pricing your next source of competitive
advantage? 1. In Innovation in Pricing (pp. 11-27). Routledge.
Madsen, T.L. and Walker, G., 2015. Modern competitive strategy. McGraw Hill.