A Critical Analysis of the Article : "For Which Purposes Do Managers Use Balanced Scorecards?: an Empirical Study"

While there are many advantages to using balanced scorecards in your accounting toolbox, there are a few disadvantages to the method as well. First, the balanced scorecard takes forethought. It is not a tool you can just think up one night to solve a problem. Instead, it is recommended that you hold a meeting to plan out what goals you would like to see your company reach in each of the four above areas. Once you have clearly stated objectives, you can then begin to break down these objectives in what you will need, financially, to bring these objectives to fruition. As explained by Bowen (2011), while the balanced scorecard gives you an overall view of the four areas for concern in business growth and development, these four areas do not paint the whole picture. The financial information included on the scorecard is limited. Instead, to be successfully implemented, the balanced scorecard must be part of a bigger strategy for company growth that includes meticulous accounting methods. Many companies use metrics that are not applicable to their own situation. It is vitally important when using balanced scorecards to make the information being tracked applicable to your needs.

A balanced scorecard is a tool to provide management a way to bridge the gap between the organization’s strategy and vision and the operational processes used to do business. It enables the company to look at more than just the financial targets, but to include nonfinancial measures such as customer service, internal business processes and more. These intangible measures provide better focus on the organization’s long-term strategies. This paper is an attempt to analyze Frieda Fizz decision to utilize a balanced scorecard as they expand into new geographic areas. The strengths and weaknesses of each perspective are discussed along with the pros and cons of using

Introduction- To be competitive, organizations must be both strategic and tactical to the nth degree, must be proactive rather than reactive, and must find a way to measure this easily and accurately. One way to accomplish this is through a Balanced Scorecard approach; a tool often viewed as one of the best tools that helps organizations translate strategy into performance. In general the BSA (Balanced Scorecard Approach) allows for a clear strategic and tactical directions for the organization, retains financial measurements in a summation along with their links to performance, and highlights an important and robust measurement system that links and integrates customers, stakeholders, processes, resources, and performance into single measurement strategy.

A balanced scorecard is the comprehensive collection of ongoing activities and processes that organizations use to systematically coordinate and align resources and actions with mission, vision and strategy throughout an organization making it a strategic planning and management system. (Balanced Scorecard Institute, 1998-2010). The scorecard exposes financial, customer, employee learning and growth, and internal business process objectives crucial to attaining goals of the vision and mission statements. When establishing such objectives, an evaluation of the company’s vision statement, mission statement, and furthermore, core values is

In the modern business and organizational environment, particularly as a result of globalization, competition equates performance. To be competitive, organizations must be both strategic and tactical to the nth degree, must be proactive rather than reactive, and must find a way to measure this easily and accurately. One way to accomplish this is through a Balanced Scorecard approach; a tool often viewed as one of the best tools that helps organizations translate strategy into performance. In general the BSA (Balanced Scorecard Approach) allows for a clear strategic and tactical directions for the organization, retains financial measurements in a summation along with their links to performance, and highlights an important and robust measurement system that links and integrates customers, stakeholders, processes, resources, and performance into single measurement strategy. This tool also provides the organization with a tool that takes vision and moves it to strategy, and the conversely, strategy into tactics. BSA supports planning and unites the organization into a more singular vision and common goal. It also allows for both internal and external feedback so that performances and results continue to evolve and improve.

There is a great deal of struggles Managers face when it comes to accounting related decisions. Financial reports are often conducive in coming up with resolutions regarding company operations, but they don’t necessarily contribute to the direct goals and missions of said companies. Individuals such as Nolan Norton and Robert Kaplan were among the first group to recognize the dilemma of solely relying on financial reports and the outcome resulted in what is now known as a balanced scorecard (Bible, Kerr, & Zanini, 2006, p. 18). In an article written by Larry Bitner and Mary Myers (2010), Kaplan and Norton state that balanced scorecards are used for “translating an organization’s mission and

The balanced scorecard can act as different roles in a company. When acting as a measurement of performance, BSC follows two steps. Firstly, it draws objectives and measures from the company’s overall strategy. In other worlds, it converts the vague strategy into detailed actions. Then, by using these objectives and measures as a benchmark, the performance are evaluated from four different aspects including the financial, customer, internal-business-process and learning and growth perspective (Kaplan and Norton, 1996). The financial perspective concentrates on financial health of a company, it is the most direct way for executives to measure organization performance. Usually, the good performance of the other three perspectives of the scorecard will lead to good results of financial performance as the four perspectives are interrelated. In terms of

The leading organizations use performance measurement with the aim of gaining insights to their organizations and the efficiency of their people, programs and processes. The organizations do not only collect and analyze data but they also use performance management to transform various strategies into actions and to improve their operational processes (Northcott and Ma 'amora Taulapapa 2012). Accordingly, performance management is used to manage the organizations. The Balanced Scorecard (BSC) is a prominent performance management system in the contemporary world and it was developed by Dr. David Norton and Dr. Robert Kaplan at Harvard business school. Compared to other systems of measuring performance, the BSC considers various

The balanced scorecard is a strategic measurement strategy used in business and government as a measurement tool. The balanced scorecard should reflect businesses plans and strategic goals. The balance scorecard “was originated by Drs. Robert Kaplan (Harvard Business School) and David Norton (n.n October 8th, 2015). Balanced scorecard is used by managers not only to measure performance but to align their goals and execute the visions and missions of any agency. The balanced scorecard include metrics in different perspective views, these include “The learning and growth perspective, the business process perspective, the customer perspective and the financial perspective”.

This report focuses on the application on one such framework, the balance score card, designed to enhance strategic performance in an organization. .Originally developed and recognised as a performance measurement tool but since incoporation of many ideas, the scorecard is now linked increasingly with strategy execution. Till today

A theory and management approach of the Balanced Scorecard was first “proposed in the Harvard Business Review by Robert S. Kaplan & David P. Norton (1995)” (Knapp, 2001). In the book called ‘The Balances Scorecard’ Kaplan and Norton (1996) translated organization’s mission and strategy into comprehensive set of performance measures. That

Therefore, through this paper, we have devised a process of calculating a suitable bench mark figure called “Balanced score” through which the achievements of the performance in the implementation of the strategy by the firm can be evaluated. The paper uses the concepts of “Balanced scorecard” proposed by Kaplan and Norton (1992a); and the model adopted by Brown

The connotation of the Balanced Scorecard shown that not just in the past performance, to put more time on future performance

The use of balanced scorecard has been developed from the early use as a simple performance measurement framework, a complete strategic planning and management systems. The "new"

In fact, many of these PMS tools and technological innovations were transformed based on those traditional ones to better meet the organisation needs in the contemporary era. More than 30 popular cost and management accounting techniques have been introduced since 1950 (Refer to Table1). Abdel and Luther (2006) described that the most notable innovative management accounting techniques are Activity based costing (ABC), strategic management accounting and the BSC. Among all the modern management accounting tools and techniques, this paper focuses on BSC as a performance measurement system and will be discussed in the next section.