Balanced Scorecard

As mentioned in the introduction above, different business types bring a significant different treatment of strategic business control and evaluation. Consider for example, a firm that produce sheets of paper. The production processes are well defined and relatively stable, functional skills are specialized to gain operating efficiencies. There are

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relatively no strict challenge from the same competitor, because the market share are divided equally, as long as they keep the productions quality and maintain the cheapest cost of production.

Regardless of whether the environment is stable or dynamic, an organization needs to exercise control over its operations so that its objectives are achieved as preliminary business planning. Firm that operate in a stable environment with standardized products and processes and low competitive pressures will employ the less complex functional business strategic. While the more complex firm with the dynamic competitor pressure should be consider to employ the more complex strategic control system (Shaw, 2004).

Concerning the development of strategic control over a corporation, this paper will discuss about the Balanced Scorecard (BSC) for a company named ‘Puppy Luv Doggy Day Care’. Furthermore, it also develops at least three strategic objectives for each of the four Balanced Scorecard areas (Financial, Customer, Process, and Learning & Growth). 2. Balanced Score Card of Puppy Luv Doggy Day Care 2. 1. Balanced Score Card The Balanced Scorecard (BSC) is one of the most influential business ideas in the 20th century.

It was noted that over one-half of the fortune 1,000 uses the BSC system (Niven, 2006). Some people consider it as a form of project management, a form of measurement or controlled improvement system. Despite the awesome popularity of the concept, we witnessed the practice of the BSC concept surprisingly concentrates on the private sectors. Robert Kaplan and David Norton first introduced the Balanced Scorecard in the early 1990’s as a strategic management system that forces managers to focus on the important performance metrics that lead to success.

There are four perspectives of BSC as following: 1. Financial perspective This is the standard perspective that everyone

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uses even before the BSC. Even a non-profit organization uses this perspective in order to balance their books. It measures financial performances through financial ratios and other financial indicators. In the case of Puppy Luv Doggy Day Care, the financial perspective includes strategic objectives in following areas: ? Market share ? Revenues and costs ? Profitability

? Competitive position 2. Customer Perspective It is a measure of corporate value viewed from the value it delivers to customers. For instance, time taken to process a phone call, result of customers’ surveys, number of complaints, competitive rankings, etc. In the case of Puppy Luv Doggy Day Care, the Customer Value Perspective includes strategic objectives in following areas: ? Customer retention or turnover ? Customer satisfaction ? Customer value 3. Business Process Perspective

It measures corporate value from the enhancement of its business processes, like time spent prospecting, quality cost, product rework required, etc. In the case of Puppy Luv Doggy Day Care, Process or Internal Operations Perspective includes strategic objectives in following areas: ? Measure of process performance ? Productivity or productivity improvement ? Operations metrics 4. Learning and Growth Perspective This perspective measures corporate value from its learning abilities or the progress of its learning processes.

Example of activities measures are staff training, employee suggestion and improvement of certain processes as an outcome of the learning process (‘Balanced Scorecard’, 2006). In the case of Puppy Luv Doggy Day Care, the Learning and Growth (Employee) Perspective includes strategic objectives in following areas: ? Employee satisfaction ? Employee turnover or retention ? Level of organization capability ? Nature of organization culture or climate ? Technological innovation These perspectives are then adaptable to various businesses by choosing different drivers for each perspective.

The BSC can also detect and measure correlation between activities, in order to help decide which activities positively impacted others. For instance an online customer service can help reducing telephone calls and time to handle complaints, thus increasing effectiveness of business processes. According to Kaplan and Norton, there are various utilities of the Balance Scorecard. Some of them are: to clarify and update strategy, communicate strategy, align unit goals with corporate strategy, link strategic objectives to long term target, etc (‘Balanced Scorecard’, 2006).

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