HA2011 Managerial Accounting: Balanced Scorecard Implementation in BGC Pty. Limited

This report explores the application of the Balanced Scorecard (BSC) framework in BGC Pty. Limited, a leading Australian construction and mining company. It provides an overview of BGC, describes the BSC and its features, highlights the differences between BSC and traditional performance measurement systems, and assesses the suitability of BSC for BGC's operations. The report analyzes the four perspectives of the BSC: financial, customer, internal business processes, and learning and growth, demonstrating how each perspective contributes to BGC's overall performance and strategic goals.

HA2011 Managerial Accounting
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Table of Contents
Introduction......................................................................................................................................3
a) Overview of BGC Pty. Limited...............................................................................................4
b) A description of the BSC and its features...............................................................................4
c) In what ways BSC is different from traditional performance measurement systems.............7
d) Suitability of BSC for BGC Pty limited..................................................................................8
Reference.......................................................................................................................................11
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Introduction
In the company, there is the need to measure the performance in an effective manner so that
further improvements can be initiated. In the given report an understanding of the balanced
scorecard will be obtained. All this will be carried in context of BGC PTY limited. The first part
of the report will be providing a brief overview of the company so that information in relation to
it is collected. Then the technique known as balanced scorecard will be used and the same will be
explained in detail. There was a traditional performance measurement system which was
followed and so the manner in which the balanced scorecard is different from it will also be
described. Lastly, the evaluation will be made in respect of the suitability of the provided
approach in the company that is selected so that required results can be achieved by the proper
implementation of the approach.
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a) Overview of BGC Pty. Limited
BGC is the company which was established in 1970’s in Australia. It is dealing in the
construction business and is providing all the material and services related to the building. The
construction is performed in respect of the commercial and residential buildings. It also deals
with the manufacturing of building products, civil engineering construction, contract mining,
insurance, road transportation ownership and management of the property. In the current period,
it is one of the largest construction and mining contractor. The main offices from which the
company is carrying out its operations include Brisbane, Perth, Sydney, and Whyalla together
with some of the branches which are established in regional areas (BGC, 2014). There are
various businesses which are performed under this and by that all the areas are covered. The
company is in good financial position and this will be making it be successful and survive in the
market for long. The company is having a skilled team which is efficient enough to handle all the
projects in an appropriate manner and by that all the deliveries which are due with the company
are made on time. The company is following a business management system by which all the
processes are managed in the business and also the attention is provided to all the health and
safety issues (BGC, 2014). Quality assurance is made possible by the use of the resources
available.
b) A description of the BSC and its features
In the company, there are various levels at which operations are to be performed and it is
required that all the strategies in this respect shall be implemented and managed in the most
appropriate manner. For this balanced scorecard will be used as this provides the framework for
the same. By this, the overview of the performance of the company will be obtained. In this
various elements of the business are integrated with each other so that they can be performed in a
combined manner. In this, there are various objectives which are set and they are related to the
strategy (Bhattacharya, et. al., 2014). In the company, it will be possible to develop the balance
in between all the activities which are performed and for that all the financial, as well as non-
financial aspects, will be taken into account. In this approach, four perspectives will be involved
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that covers the four areas. They all; will be providing the company with some of the other
benefits. They include following:
Financial perspectives: In this, the company will be looking after the financial matters. It is
important as the business will be carried in accordance with this only. It is required that funds
shall be managed in the most effective manner and for that, all of the factors which affect them
shall be taken into consideration. The shareholders of the company will also be covered in this
only as they are the ones who will be greatly affected by any change that takes place. The
objectives in this respect will be set and they will have to be acquired. For this, it will be required
that appropriate financial measures shall be made and they shall be implemented so that all of the
benefits are received by the company which will further be provided to the shareholders.
Customer perspectives: In any business customers are most important and this is because they
are the ones for whom the products and services are provided by the company. So for this, it is
necessary to ensure that all the measures are appropriately taken. All the actions will be taken
with the goal of consumer satisfaction (Valmohammadi & Ahmadi, 2015). For this all the
requirements and needs of them shall be identified and also the preferences of the consumers will
be ascertained. They all will be considered and then services and products will be provided in
that way only. They shall meet the requirements by which most of them will be satisfied and will
not think of leaving the company. By this consumers will be retained as they are satisfied and
this will be positive for the business as they are not required to make the new customers time and
again.
Internal business process perspectives: The Company will be undertaking several processes in
the carrying out of the functions in the business and for that, it is required to ensure that proper
steps are taken and there are no loopholes in the process by which the performance of the
business will be affected. It will be identified that whether the company is following the proper
policies and process in this respect and they are carried in such manner by which the best results
will be attained. Also, the customer needs shall be taken into consideration and designing shall
be done by including them so that satisfaction is provided to them. The aspects in which
company is specialized shall be identified so that they can be further enhanced. Also, the
measures shall be taken by which the company can overcome the shortcomings which are
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involved in the processes (Hoque, 2014). By this the evaluation is made of the performance is
made as all the activities are tested to identify that they are being undertaken in the best manner.
Learning and growth perspectives: The working in the company is done by the employees and
so it is necessary that they shall be possessed with the required skills, knowledge and talent.
They shall be having appropriate qualification and it shall be ensured that they have the
experience as to what is to be done and in what manner. The whole process shall be in
knowledge of them so that no issues are faced while carrying out of the activities. The learning
shall be made a continuous process and there shall be proper programmes which are launched in
this regard. Training shall be provided to all the employees who are new so that they are aware
of all the aspects and the processes which are to be performed by them (Shen, et. al., 2016). They
will know that the manner in which they will work will provide the company with the required
results. The growth will also be made at their personal front as the training which is provided
made them have the required skills and that can be used by them in the future also as they will be
aware of the same. So there will be an addition which will be made to the knowledge of the
employees. By this, the improvement in the structure will be made and so it is needed that
regular enhancement shall be made by which the value of the business will be created.
The balance scorecard will be used by the company and there various features which are
associated with this and an understanding of them can be gained from below.
 By the help of this technique, it is possible for the company to develop a positive image
in the minds of the consumers regarding the business. It will be possible by it to provide
the shareholders with the certainty that they will be benefitted and will be receiving the
advantages. The objectives of the company shall be made clear and it will be ensured that
there are no conflicts among the interest which will be received by the company and the
stakeholders.
 This helps in the establishment of an effective communication in the organization by the
help of which it is possible to inform about all the strategies in the company to all the
members and the employees and they will be aware of the manner in which they are to be
implemented in the company, This will be further ensuring that all of the objectives of the
company are attained in such manner which will be best. The strategies will be converted
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to the targets which are to be met and this way it becomes easy to achieve them. The
actions which are to be taken by the managers are specified and they are provided the
guidelines for the same with the help of this approach.
 There are certain situations in the business in which it is not possible for the manager to
make the decision by considering the financial and non-financial factors and in such case,
this technique plays an important role (Tjader, et. al., 2014). The decisions are taken with
the help of the approach by taking the predictions in the account as they are to be made
with the help of it. They will be such by which short-term targets will be set and the
company will be benefitted.
c) In what ways BSC is different from traditional performance measurement systems
In the company, it is very much necessary to measure the performance and for that, it is required
that proper approach and system shall be followed in this respect. By the help of them, it will be
possible for the company to have all the information about the manner in which working is being
carried out by the company. For this, there are several approaches which can be undertaken. In
the earlier times, traditional performance measurements system was taken into use by the
companies in which the process was carried by considering only the financial aspects of the
business (Taticchi, et. al., 2015). In that profits and other cost were taken into account. The non-
financial aspects were not included in this and due to this, the company lacks the accurate results.
This is because in the business there are various such components which are not related to the
finance but they are very much essential for the company. In this, the coming future perspectives
are not taken into consideration which is the shortcoming as there is the risk which gets involved
due to it and that can have the adverse impact on the business.
The company will not be having all the information and due to it there will be issues in the
decision-making process and they will not be made in the most effective and efficient manner.
There will be a risk that they can prove to be incorrect in the long run. The managers will be
making such decisions by which only the short-term benefits will be undertaken and they will
not take the long run growth in the account. In the changing environment, the business faces a
high level of competition and that shall be dealt in an appropriate manner (Melnyk, et. al., 2014).
For that, all the qualitative aspects and the market conditions are also to be noted which is not
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done in case of traditional system and so that company has to bear the impact of it. They are not
able to make the advantage due to the completion by including the perspective of the rival.
In case of balance scorecard, this is not the case as in that all of the aspects are included and they
take into account the financial and non-financial both the prospects. For this, the approach
includes the four main perspectives and they have been explained above. In the company, I able
to look after all the areas and there is no point which remains unconsidered. This way it is
different from the traditional approach (Micheli & Mari, 2014). There will be a proper system by
which the needs of the consumers will be determined and this will help in dealing with the
completion by providing them with what they need. Also, the other perspectives provide such
results which are helpful or the management in the making of decisions. They will be having all
the data which is needed and can take such steps which will be providing the long-term benefits
to the company as in this the risk factor is also taken into use by the business.
d) Suitability of BSC for BGC Pty limited
In the given company which is BGC balance scorecard will be of great help as it will be used in
all the operations which are performed by the company. The company is dealing in the
construction business so that needs of the people in respect of the design and the material which
is preferred is to be identified in advance. This will be made possible with the help of this
approach. All of the managers will be using it for the benefit of the business. In this company,
there are various processes which are undertaken due to the fact that company is included in the
providing of various services (Ibrahim, 2015). This will be required ensuring that all of them are
performed in such manner by which there will be no conflicts in the business and it will be able
to deal with the requirements that are specified. The internal process will be made strong and it
will be seen that all of the required information is made available to the various departments so
that they can perform the actions in the best manner.
The company can use the financial perspective in such manner by which it will be able to take
the decisions regarding the cost and the price which will be charged in respect of the material
that is provided. Then the BGC can also include the interest of the investors in the consideration
and make the system by which they will also be provided with the required returns. All the
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earnings will be evaluated and then the distribution of the income shall be made to all the
shareholders in an effective manner.
The manufacturing process which is involved in the company will be requiring that all the
employees and workers shall possess the required knowledge and the information which they can
use in the carrying out of the activities. They will be provided with the training in which they
will be made familiar with the tools and techniques that are to be used in the business. They will
be given relevant information about the processes so that they will not be facing the issues. By
this, the whole process will be improving and the company will be able to manage the balance
among all the activities which are met in the business (Jones, 2016). There is the further need to
take into consideration all the aspects which are related to competition and also the policies
which shall be followed. The strategy will be followed in such manner by which it will be
ensured that the objectives which are set by BGC are attained in a timely manner. As the whole
process will be established in advance and will be communicated to all the members and the
employees so it will be possible for them to undertake it in the most effective manner.
By all of this, it will be possible to take the best decisions and make the business run in such
manner by which all the targets and objectives which have been set can be achieved in an
appropriate manner. All the performance will be measured and if needed then the required steps
will be taken so that further improvements can be made by the company and it can maintain its
position in the economy and have the business run for long.
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Conclusion
From the report that is presented above, it can be concluded that the balanced scorecard approach
is very essential for the measurement of the performance and maintenance of the balance in the
company. For this BGC company is taken into account and an overview of the same is provided
in the first part of the report in which all the activities which are undertaken by the company are
considered. By that, an understanding of the business is obtained. Then the explanation for the
balanced scorecard is provided in which all the aspects which are there and included in this are
defined. They are explained in detail together with the features which are associated with them.
In addition to this, the manner in which the traditional approach which is used earlier is different
from the BSC has been identified. All the deviations in this respect are determined and will be
taken into account. The manner in which this approach is used in the company and will be
providing the company with the required benefit is also ascertained and this all will be in the
interest of the business.
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Reference
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https://www.bgc.cc/assets/media-page-items/BGC-Contracting-Company-Overview-
2014.pdf. [Accessed: 11 May 2018]
 Bhattacharya, A., Mohapatra, P., Kumar, V., Dey, P. K., Brady, M., Tiwari, M. K., &
Nudurupati, S. S. (2014). Green supply chain performance measurement using fuzzy
ANP-based balanced scorecard: a collaborative decision-making approach. Production
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 Hoque, Z. (2014). 20 years of studies on the balanced scorecard: trends,
accomplishments, gaps, and opportunities for future research. The British accounting
review, 46(1), 33-59.
 Ibrahim, M. (2015). Investigating the use of the four perspectives of balanced scorecard
(BSC) as the technique for assessing performance by Nigerian banks. Journal of
accounting and taxation, 7(4), 62.
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balanced scorecard. Routledge.
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measurement and management fit for the future?. Management Accounting
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 Micheli, P., & Mari, L. (2014). The theory and practice of performance
measurement. Management accounting research, 25(2), 147-156.
 Shen, Y. C., Chen, P. S., & Wang, C. H. (2016). A study of enterprise resource planning
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 Taticchi, P., Garengo, P., Nudurupati, S. S., Tonelli, F., & Pasqualino, R. (2015). A
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chain management. International Journal of Production Research, 53(21), 6473-6494.
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 Tjader, Y., May, J. H., Shang, J., Vargas, L. G., & Gao, N. (2014). Firm-level
outsourcing decision making: A balanced scorecard-based analytic network process
model. International Journal of Production Economics, 147, 614-623.
 Valmohammadi, C., & Ahmadi, M. (2015). The impact of knowledge management
practices on organizational performance: A balanced scorecard approach. Journal of
Enterprise Information Management, 28(1), 131-159.
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