Balanced Scorecard Evaluation

Answer

Balanced Scorecard Evaluation

            The purpose of this essay is to evaluate the fundamental aim of the balanced scorecard while exploring its primary elements.

The Purpose of a Balanced Scorecard

            The balanced scorecard is a strategic management tool which is utilized to measure performance metrics as well as identify and improve the internal functions of the business which further generates the external outcomes. Hynes (2016) reiterates this factor by providing that balanced scorecards are utilized to measure and outline feedback regarding performance to organizations.

Balanced Scorecard Elements

            The financial perspective is one of the traditional perspectives available on the balanced scorecard (Hoque & Adams, 2011). In this case, the revenues and profits generated by a business are included hence providing an outlook of the financial health of the business. In the case of ABC International Inc., the profit margins are desirable providing a depiction of the fact that the business financially sound. The firm’s profit margins have been increasing steadily over the past 5 years. Looking at the customer perspective, it is evident that the company’s market share has been increasingly within the US market suggesting good customer service and satisfaction rate (Soderberg, Kalagnanam, Sheehan & Vaidyanathan, 2011). On the international process perspective, it is evident that the business has relied on the use of technology with a major focus of boosting its efficiency rates. Therefore, meeting the set objectives of the business becomes simpler. On the learning and growth perspective, it is evident that the business invests in its human capital by ensuring the development of the talent of the members of its workforce.

            Coming up with a communication protocol is important since it guides the management to communicate to the relevant departments about the performance of the business (Muchandigona & Kalema, 2012). With effective communication flow, the staff members can understand how to meet their set targets and business objectives. At ABC International Inc., the management communicates to the staff in different ways such as through the use of internal memos. Under the balanced scorecard, the HR professional plays the role of participating in the process of planning and development (Rosch & Priest, 2017). For instance, ensuring that the corporate objectives of the business align with the set performance goals.

            Different action plans can be considered to meet the goals in question. For instance, to meet the goal of enhancing conflict resolution skills, the candidate in question should engage in research to understand how to enhance these skills within the next two month.

Importance of the Balanced Scorecard

            The balanced scorecard is important since it assists the manager in making better prioritization decisions (Hwa, Sharpe & Wachter, 2013). Moreover, the tool is also effective since it guides the leaders to see the right initiatives which are important in meeting the goals of the business. Additionally, the balanced scorecard is also effective in meeting the goals of the business by outlining the initiatives which should be provided with a priority (Huber & Hiltmann, 2010). This includes incorporating feedback and reviews from the customers as well as internal process to ensure an improved growth (Nowakowska-Krystman, 2013).

Balanced Scorecard

            Figure 1 below outlines the ABC International, Inc. important balanced scorecard elements.

Figure 1: ABC International, Inc. Balanced Scorecard Elements