The BSC tells the technical story of its formulation Essay
The BSC tells the technical story of its formulation
It begins from the initiation of the strategy, to the high level business executives who would sponsor the program, to actual scheduling of it, and then to the allocation of resources to it, and finally to actual budget. The BSC has an inbuilt feature to enhance general strategic goals, and competition in the private industries, or a clear declaration of mission and better efficiency in the public sector. So it has beneficial features no matter what the individual sector.
It enhances financial goals in the private sector by helping the company capture bigger market share and therefore increases profit margin. It enhances productivity, and efficiency. It is equipped to achieve desired outcome by increasing customer satisfaction. The benefits from BSC is enormous, it allows the entire organization to put itself in a continuous learning process. By aligning all the strategy in one framework, it strengthens itself in time, even with resource allocation. It helps organizations to make better budgetary decisions, it improves performance, and communication, and enable the company to have important data for its bench marking. It helps the company to develop management system that is based on facts.
It can anticipate the future, and can help organizations reach beneficial cause and effect predictions. It supports accountability and makes it easier to implement necessary innovations. The BSC system makes it simple for organizations to follow, because the steps are clearly outlined. First the company would make an initial organizational assessment, to ensure itself that it truly is ready to embark on the BSC system, because even though the system could be highly profitable, it is not cheap.
The next important step would be the definition of the company’s strategic themes, or the area it needs to focus on. Then it would develop its objectives, and the strategic maps, and performance measures. The system would then be cascaded to the essential business units. The final step is usually the evaluation and then important adjustments. A decision by a company to undertake the BSC cannot be made lightly, it is a big business venture. So the company must ask itself what its missions are, if it is ready to embark in such huge application.
The company must know what it wants to provide in terms of services or programs. It must be sure that those needs are required needs, service or program that would sustain the implementation of the BSC, the balance scorecard would not help a poor business idea. The company must ask itself how it could be more beneficial to its customers and to its stakeholders. And does it have the capacity to change and improve as the business environment would eventually demand. Would the organization be able to provide required satisfaction to both the customers and the stakeholders.
On the implementation steps the process is also clear. Because it would not make sense to place team leaders into position of leadership without adequate training, BSC demands workshops and both leadership training and team training. And that would be followed by the assessment of the corporate objectives, and strategy developments, then a draft of those important strategies. It would be essential to have the corporate executives involved in these processes as much as possible. In the BSC the essential training are supported by computerization or automation of the strategies that were developed in order to provide access to all concerned.
There are some barriers that could adversely affect the implementation of the process if left unresolved. If the company is unable to clearly define its mission and vision, the BSC would not be able to effectively implement such poor visions. So to make the visions and missions actionable it ought to be very well defined. Also the corporate strategies, the budget planning process and the entire goals should be linked to the performance drivers.
Employees involvement with reasonably positioned performance expectation must be appropriate. It would not make sense to set them to high at the onset. The entire story ultimately returns to the fact that balance scorecard has the ability to give corporations a solid framework, i. e a good sketch in which to design its strategies and align them with excellent chances to pursue such critical elements as efficient customer service and better learning atmosphere for the employees. All indications are that this system has been effective for organizations that have applied it accurately, and Pepsi Saudi should benefit from the implementation as well.