Balanced Scorecard Analysis

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Balanced Scorecard Analysis

• Justin Haffey
• Caroline Myers
• Kelly Vacari

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• A new approach to strategic management
• Developed in early 1990 by Dr. Robert Kaplan and
  Dr. David Norton.
• Was developed because traditional financial
  measures were inadequate.

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What is the Balanced Scorecard?

• The balanced scorecard is a management system
  that enables organizations to clarify their
  vision and strategy and translate them into
  action.
• It provides feedback around both the internal
  business process and external outcomes.

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Four components of Balanced Scorecard
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Learning and Growth Perspective

• An organization's ability to innovate, improve,
  and learn ties directly to its value as an
  organization.
• How can we continue to improve and create value
  for our services?

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Business Process Perspective

• Must focus on critical internal operations that
  enable the organization to satisfy customer
  needs.
• To satisfy our shareholders, what business
  processes must we excel at?

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Customer Perspective

• Must know if their organization is satisfying
  customer needs.
• To achieve our vision, how should we appear to
  our customers?

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Financial Perspective

• In the private sector, measure typically focused
  on profit and market share.
• To succeed financially, how do we appear to our
  shareholders?

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Double Feedback Loop

• The balanced scorecard incorporates feedback
  around internal business process outputs, as in
  TQM, but also a feedback around the outcomes of
  business strategies

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Outcomes Metric

• Metrics provide a factual basis for defining
• Strategic feedback to show the present status of
  the organization.
• Diagnostic feedback into various processes to
  guide improvements.
• Trends in performance over time.
• Feedback around the measurement methods
  themselves
• Quantitative inputs to forecasting methods for
  decision support systems

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Tie to Employee Performance

• A balanced approach to employee performance
  appraisal allows management to get a complete
  look at their performance.
• Managers are able to provide information needed
  to align employee performance plans with
  organizational goals.

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Balanced Scorecard Adopters

• Non-Profit Organizations
• Vinfen Corporation
• Private Schools
• Government Organizations
• Federal Aviation Administration
• Department of Energy
• United Postal Service
• Colleges and Universities

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Adopters Continued

• Commercial Organizations
• Southwest Airlines
• IBM
• Pfizer
• Ford Motor Company

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FAA Logistics Center
Financial Strategy 1 Increase revenue and
margin. Strategy 2 Achieve a return on
investment for new systems Strategy 3 Decrease
or stabilize core product prices.
Internal Processes Strategy 1 Increase the
number of projects organically supported. Strategy
2 Improve product delivery processes and
systems. Strategy 3 Improve internal cost
analysis processes.
Customer Strategy 1 Increase customer
satisfaction. Strategy 2 Increase Quality
Ratings. Strategy 3 Increase customer support
to enhance system availability.
Mission Grow the Logistics Center as a
provider of choice for aviation-related equipment
through re-engineering, repair, and supply chain
management of future and legacy systems.
Learning Growth Strategy 1 Develop workforce
strategies that will identify and train to
competencies. Strategy 2 Integrate an automated
warehouse management system.
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Conclusion

• The Balanced Scorecard Analysis is very
  beneficial to an organization.
• It enables executives to truly execute their
  strategies.
• Any Questions??