Balanced scorecards have a lot of benefits, but there is one aspect where it really make a difference: improving management process. A BSC case study is then in order.
There is an appropriate balanced scorecard for every management aspect – from the formulation of vision,
missions, and goals to the preparations of plans, objectives, and implementing strategies. The pervasive nature and application of a balanced scorecard is a good indication of its importance in management efficiency. It is not surprising that companies from time to time resort to a BSC case study to assess and, if needed, modify the BSCs currently incorporated in the company’s management system.
The relevance of a balanced scorecard is greatly influenced by the quality of the stated vision, mission, and goals since these are statements that are supposed to provide direction to the company. Plans, objectives, and specific strategies aimed at accomplishing predetermined outputs in each of the general key performance areas, such as finance, internal processes, customer development, and learning and growth can only as good as the vision, mission, and goals from which they are based on. It is impossible to formulate a plan that corresponds to a goal when the goal itself is not properly defined. In itself the plan may be well prepared with all essential components – specific strategies and activities, resources, timeframes, and accountabilities clearly defined and established – but the fact that it cannot be measured against a goal makes it difficult to determine whether the plan is valuable or not.
One thing that a balanced scorecard must be able to do is synchronize and incorporate all company activities, routine or project-based, into a single coherent whole. For large companies where many departments are involved in completing a task or tasks, balanced scorecards must be detailed enough to prevent occurrence of gaps or overlapping in activities and functions of departments sections and individual employees. For this, it is very important that responsibilities and functions of each department and individual must be specific and clearly defined.
Perhaps the most important use of a balanced scorecard is in the development of an effective management process. This entails ensuring that the vertical and horizontal flow of communications is constantly smooth so that activities and routines of even the lowest-positioned employee are always aligned with general goals and objectives. This is done by creating a system where all important information regarding plans, corresponding strategies and activities, and details of implementation results are documented and distributed to offices and employees who, in the course of performing their assigned duties, have need for them.
Documentation plays just a part, although a significant one, in creating a reliable communication process. A good balanced scorecard will also establish the necessary procedures and accountabilities for information gathering, documentation, and dissemination. This is very crucial for any organization, as a break in the communication system can result to work delays or general confusion. Anytime this happens, outputs are sure to suffer.
There seems to be a lot of work involved in putting together an efficient balanced scorecard. There certainly is, but the load is lightened when the responsibility is shared. A BSC case study to assess and institute required changes to the measurement mechanisms can easily be done in conjunction with regular company assessments with a representative number of employees participating.
