Balance Score Card

Question: Discuss about theBalance Score Card. Answer: Introduction Balance Score Card or BSC is worldwide used by all government, non-government, across all the industry. It is basically a performance meter or measurement metric of all the division of the company. It is a part of strategic planning and management system. The objective is to alignment of the business activities and provides more balanced view to the managers and the executive about the organizational performance. It not only depicts the financial performance but also evaluates the non-financial metrics like customer feedback, organisational growth, business process optimization and also enriches the learning mechanism. It is the one activity which enables the companys success. BSC combines the financial and non-financial measures it depicts the four perspective of the company Financial Customer Internal business process and Growth and learning A fully executed BSC narrates the relationships among the business activities measurements which can add value to the shareholders. By aliening the business activities it extracts the areas of concern and how to develop those areas. It has four phases, and to become successful the organisation should keep the balance between these phases. The phases are Financial perspective: this perspective shows the financial success of the company. This is the cost incurred by the management. The operational cost as well as ROI (return on investment) evaluation. Customer perspective: customers are the most valuable part of external factor. It evaluates the customer satisfaction from the feedbacks and other communication from customers as well as the market share held by the company. Customer relations retain the customers. Buying process perspective: it is the measurement related to the business process in terms of business cost and quality. Learning and growth perspective: it measures the employee satisfaction and retention; also it focuses the areas where the learning and development is required. As these phases or perspectives are co related, then cant work independently. Discussion Critical Analysis of the Effectiveness of Balance Score Card: Business score card is the tool for evaluation of the performances of every internal and external activities of the organisation. It is the process of alignment of all the business activities. The objective is to synchronise the activities, which could measure and monitor the performances of the activities. Also helps to make profit by balancing all the business activities. When assessing the four perspectives the following factors are used: Objective: it depicts the organisation goal, such as the making profit, maintaining the expected ROI market share. Measures: based on the goal it measures the performance achievement. Targets: it can be overall target or department wise target. May be production target or may be sales target. Initiative: this is basically the steps or actions are executed to achieve the goal. The BSC has become a management strategy as it has become very popular for its logical and systematic process and worldwide it is accepted. The balance score card gives a solution in the four areas only. Beside that other key areas should also be taken under consideration. But major concern is that only the evaluation or measuring the performance is not the enough, the management or the board has to find out the areas of concern. Then proper action should be taken so that the purpose of balancing the business activities can be properly execute. The result should be verified and the collection of data must be accurate to get the proper output. For the public sector organisations the real customers to find out is really tough also it has multiple stakeholders (Govt., funding entity, service users etc) (Balancedscorecard, 2016). There are lots of contradictions available, many companies complain about the failure of this technique. The proper data collection is very important as it was revealed that the exercise was done on the basis of employees and they dont have the clear concept of BSC. It is also necessary to have the proper balance in internal management to run this technique. Later many researchers have confirmed that BSC has to be analysed and implemented properly. The limitation is the complexity and the data collection technique. Antonsen (2010) says, Balance score card implementation requires a company to gather new data or adopt new data adoption technique which can create some overloaded work to some departments. And to increase the overload many companies dont know how to focus on the success factors, cause and affect relationships because Balance Score Card does not define any template. BSC has many limitations as evidence we have seen many organisation Implemented the same but the result was not satisfactory or the implementation of BSC deviates the objective. The most important limitation is that the BSC not defined the relationship between organisational objective performance. Sometimes the stakeholders are not included. (Awadallah, 2015) Implementation of Balance Score Card: Before implementing the balance score card it is necessary to understand why Chadwick should run the BSC technique. The vision is that to lead the industry by development manufacturing marketing of the ethical drugs for Human and Animal, also by providing the quality medicine to all the hospitals including veterinary hospitals retail medicine shops. The Chadwick should divide the BSC in four perspectives: Financial: The goal is by measuring ROCE and improves the profitability, which will increase the revenue. For that sales need to be grown up(McDonald, 2012). Customers: the goal is to satisfy the customers by providing the best product or medicine which results the growth in the market share. Internal business process: goal is to develop the new areas of product development, work on the manufacturing defects and increase the effectiveness. Learning and growth: The objective is to improve the increase the employees efficiency. The measures the money spent on training. Every perspective is co related with each other so the divisional managers need to be well versed and equipped before exercising the BSC. The data collection should be accurate (Hoffmann, 2007). Conclusion Recommendation BSC provides or depicts the areas of improvements of every internal and external function. It can be used as a tool which analyses and improves the communication between the employees and the management of the company. Use of this new approach helps the planners about the measurement areas and should be done. References Awadallah, E. A. (2015). A Critique of the Balanced Scorecard as a Performance Measurement Tool; https://ijbssnet.com/journals/Vol_6_No_7_July_2015/9.pdf. International Journal of Business and Social Science , 6 (7), 91-99. Balancedscorecard. (2016). Balanced Scorecard Basics. Retrieved September 29, 2016, from Balancedscorecard: https://balancedscorecard.org/Resources/About-the-Balanced-Scorecard Hoffmann, M. (2007). A critical analysis of the Balanced Scorecard - with special consideration to its implications for HRM and HR-policy. Retrieved September 29, 2016, from Grin: All the words that caught plagi all are technical terms, i cannot even alter them. talk to your teacher. Some changes I have made but there will be plagi in the assignment. McDonald, B. (2012). A Review of the Use of the Balanced Scorecard in Healthcare. Retrieved September 29, 2016, from Bmcdconsulting: https://www.bmcdconsulting.com/index_htm_files/Review%20of%20the%20Use%20of%20the%20Balanced%20Scorecard%20in%20Healthcare%20BMcD.pdf