Balance scorecard: an overview
Added on 2021-06-15
17 Pages4129 Words371 Views
FinanceLeadership Management
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RUNNING HEAD: MANAGEMENT ACCOUNTING Balance scorecard
Management accounting1ContentsIntroduction................................................................................................................................2Part 1..........................................................................................................................................2Client’s description – Rockwater Limited..............................................................................2Part B..........................................................................................................................................3Introduction of Balance scorecard and its features.................................................................3Part c...........................................................................................................................................8Traditional approaches VS Balance Scorecard......................................................................8Part D.......................................................................................................................................11Suitability of the approach to the client................................................................................11Conclusion................................................................................................................................13References................................................................................................................................15
Management accounting2IntroductionThis report is an overview of the balance scorecard approach and features it possess. It explains in detail all the aspects of the new performance measurement tool adopted by the companies. The report provides a brief summary of BSC approach and its characteristics. This new approach of balance scorecard measures the performance of company based on its four perspectives called learning & growth, customer, financial, and internal process. The main objective of preparing this report was to check the suitability of BSC in the firm’s client. The first part deals with the detail description of the client which is Rockwater Limited, a wholly owned subsidiary of Brown & Root/Halliburton which is a global engineering and construction company. The second part of the report deals with the introduction of BSC approach and explains its features in detail. The later part contains a difference between the traditional performance measurement tools and the new balance scorecard approach. The differences reveal that BSC covers up all the weaknesses of the earlier used systems and provide greater insights to the management. In the last section, report includes a brief discussion of sustainability of BSC to Rockwater Limited and followed by the conclusion that suggests that the BSC is one of the most beneficial strategic tools which is used to measure the performance of company. Also it is best suitable for Rockwater because it helps the company to achieve its strategic goals. Part 1Client’s description – Rockwater LimitedA fully owned subsidiary of Halliburton Company, named as Rockwater Limited is an UK based underwater Engineering and Construction Company. It was founded in 1990 and is situated in Dyce, United Kingdom (Bloomberg.com. 2018). The company is a global leader within its industry. It offers variety of services that include commercial diving, scour and
Management accounting3erosion, installation of marine structures and underwater coatings. The targeted customer base of Rockwater are the oil companies whose deep-sea oil rigs are been serviced by Rockwater Limited. The major clients of the company are oil, gas and offshore construction companies. It has its headquarters in Aberdeen, Scotland and is an operating division of Brown & Root Energy Services, which is also a part of Halliburton Corporation (Kaplan and Norton, 1996).The vision and mission of the company is to great services to its customers, enhance its profitability and focus on increasing its growth in near future. The company was formed by merging two independent construction companies which is focused on improving his strategic management system and achieving its predetermined objectives. Part BIntroduction of Balance scorecard and its featuresToday all the companies have adopted BSC as a new strategic tool used for performance measurement, to keep safe and check regularly their daily activity records which is essential to achieve company’s long term goals.It helps the management in controlling the actions of staff members and to monitor the consequences of the same. It is also explained as a performance metrics which is used in strategic management with an objective to improve andenhance the internal control measure of an organization. This new approach of balance scorecard was first introduced to the world by Dr. Robert Kalpan and Dr. David Norton which was published in one of the Harvard Business Articlesin 1992 (Niven, 2011).If we consider the definition of balance scorecard given by Balance Scorecard Institute then itis defined as a tool or system used for strategic planning and implementation of the management that can be used to interlink several elements of the strategy of the company for long term run. This includes the interlinking of target areas, core values, vision and mission
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