Balanced Scorecard for Woolworths: Analysis and Recommendations

The report analyzes the usage of the Balanced Scorecard by Woolworths in Australia and recommends suitable perspectives and strategic mapping for the firm. It also provides recommendations on the key issues related to the Balanced Scorecard.

Running head: BALANCED SCORECARD
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Name of the Student
Name of the University
Author Note

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Executive Summary
The Balanced Scorecard can be stated to be a useful tool which can be largely used by the
different business enterprises in order to measure the overall efficiency of the different
operations which exist and to also measure the internal procedures which exist. The main aim of
the given report is to throw light on the usage of the Balanced Scorecard by the chosen company
Woolworths in Australia and the manner in which the business has been able to efficiently
carryout its different operations. Recommendations on the different perspectives which can be
added to the Balanced Scorecard of the firm have been recommended along with the strategic
Mapping.

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Table of Contents
Introduction......................................................................................................................................3
Analysis and Discussion..................................................................................................................3
About the firm..............................................................................................................................3
Suitable perspectives which can be used for a Balanced Scorecard............................................4
Strategy Map................................................................................................................................5
KPI`s and KPD`s.........................................................................................................................6
Critical analysis of the key issues in regard to the Balanced Scorecard..........................................7
Conclusion.......................................................................................................................................7

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Introduction
The business management is not an easy task and in order to achieve long term success, it
becomes considerably important for the managers to deploy various strategic tools which will
assist them to assess the overall performance of the firm (Valmohammadi, and Ahmadi 2015).
One such tool is the balanced scorecard tool. The balanced scorecard tool can be stated to be a
strategic planning and management system which the different organizations often make use of
in order to communicate their overall objectives, align the day to day work in line with the
strategy of the firm, prioritize the products as well as services and measure the progress which is
made by the firm (Agrawal, Singh and Murtaza 2016). The company chosen for the purpose of
the report is the Woolworths which is a supermarket firm as based in Australia. The organization
is a leader in the market and makes considerable use of the strategic management tools in order
to ensure that it is successfully able to achieve its goals and maintain its competitive positioning
in the market. The report will analyze suitable perspectives for the balanced scorecard and
present the key issues which come up in regard to the use of the Balanced Scorecard.
Analysis and Discussion
About the firm
Long term goals of the firm
 To develop a customer centric culture
 To ensure that they are able to enhance their overall operational model
 To engage in a strong relationship with their employees (Woolworths.com.au 2018).
Stakeholder group
The different stakeholder groups which Woolworths caters to are as follows:

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 Customers: The customers are the primary stakeholder group of the company and to
satisfy the customers can be stated to be the ulterior objective of the organization.
 Employees: The employees are another stakeholder group which the firm would be
required to satisfy so as to ensure long term success (Keyes 2016).
 Public: The public can be considered to be another stakeholder group which is served by
the Woolworths.
 Government: The organization has to follow various rules and regulations as set by the
Government.
 Investors: The investor group can be stated to be another crucial stakeholder group which
the firm caters to.
Suitable perspectives which can be used for a Balanced Scorecard
Like any other organization, even Woolworths makes use of the four different
perspectives of the balanced scorecard and tends to ensure that financial stewardship, customers
and investors, internal procedures and the organizational capacity to grow well are analyzed.
However, one suitable perspective which can be used by the Woolworths in order to analyze its
operations can be stated to be the aspect related to Employee satisfaction. Although the
organization makes use of the customers and the Stakeholders perspective, it needs to be
understood that the perspective often just caters to the needs of the customers of a firm and does
not take into consideration the perspective of the employees specifically (Hansen and
Schaltegger 2016). The employees tend to form a crucial part of the different supermarkets and
with respect to this it becomes considerably important for the employees to be at their best
behavior as their behavior will determine the overall sales as made by the organization and in the

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same way. Hence, one of the perspectives which can be added can be the Employee performance
and satisfaction.
In addition to this, Woolworths also needs to concentrate on the aspect related to the
Innovation and Development. The Innovation and Development forms a crucial part of any
organization and with respect to this, Woolworths, in addition to the four Balanced scorecard
perspectives already used, can make use of the Innovation and Development aspects whereby
creativity is infused within the organization and the different employees are allowed to provide
their input and lead to an overall development of the firm at large (Martello, Watson and Fischer
2016).
Specific objectives for Employee Performance and Satisfaction
 To ensure high levels of employee satisfaction in the organization.
 To reduce the employee turnover rate by 10% annually
 To improve employee productivity by 10%
Specific objectives for Innovation and Development
 To ensure that the employee participation in the current operational decision making
increases by 10% over the next six months.
 To ensure that the customer satisfaction with respect to productivity increases by 10% in
the span of one year
 To ensure that the overall sales of the firm increases by 5% in the coming year.

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Strategy Map
The given strategy map will show the overall relationship between the different
objectives under the two added perspectives of employee performance and satisfaction along
with the Innovation and Development
Perspectives Objectives
Employee
Satisfaction and
Performance
Innovation and
Development
The above strategic map reflects upon the relationship between the different objectives of
the firm and ensures that an organization like the Woolworths is able to achieve success in the
long run.
KPI`s and KPD`s
Perspectives Lead Indicators Lag Indicators
Employee Satisfaction and
Performance
Increase in the employees
hired
Decrease in the employee
turnover
Amount spent on turnover of
employees
Number of employees parting
away with the organization.
Ensuring high
level of employee
satisfaction
Reducing
employee
turnover rate
Increasing
employee
productivity
Increasing
employee
participation
Increasing
customer
satisfaction
To bring about
an increase in
the overall sales
of the firm

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Innovation and
Development
Alignment with the
organizational goals
Availability of innovative
ideas
Revenue earned per employee
Annual sales
Critical analysis of the key issues in regard to the Balanced Scorecard
The use of the Balanced Scorecard is not easy in an organization and with respect to this,
it can be largely understood that, various firms often find the use of the balanced scorecard a
difficult tool because of a large number of reasons. According to Cooper, Ezzamel and Qu
(2017), one of the most critical problems as faced in the use of the balanced scorecard can be
stated to be the poorly defined metrics. Although the Metrics of the firm are quite comprehensive
in nature, they are not defined adequately and hence, they do not serve as an exact measure of
performance of a firm. The second issue with the Balanced scorecard as per Akkermans and Van
Oorschot (2018) is that there exists a lack of adequate efficient data and collection method. Some
of the objectives as laid down in the balanced scorecard relate to that of pure qualitative in nature
and hence, becomes difficult to assess. Another shortcoming of the tool is that it focuses totally
on the internal factors whereas an organization might suffer certain consequences lying in the
external environment as well.
Conclusion
Therefore, from the given analysis it can be largely understood that, the Balanced
Scorecard Approach can be stated to be quite a comprehensive approach as followed by the
different organizations at large and with respect to this, it can be understood that, in order to gain
success in the long run, a firm needs to prioritize its overall operations which can be done using

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the balanced scorecard approach. The report examined the additional perspectives which can be
used by Woolworths and provided recommendations with respect to the same.

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References
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Cooper, D.J., Ezzamel, M. and Qu, S.Q., 2017. Popularizing a management accounting idea: The
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Hansen, E.G. and Schaltegger, S., 2016. The sustainability balanced scorecard: A systematic
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Keyes, J., 2016. Implementing the IT balanced scorecard: Aligning IT with corporate strategy.
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Martello, M., Watson, J.G. and Fischer, M.J., 2016. Implementing a balanced scorecard in a not-
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Woolworths.com.au 2018. Online shopping at Woolworths [online]. Available at:
https://www.woolworths.com.au/ (Accessed on: 28 Jan. 2018).