Challenges in Balanced Scorecard Implementation at Norwalk Division

The service techniques that are consisted of in the balanced scorecard for Norwalk Division are: maximising return on all advancement spending, satisfying client requirements, and the development of worker skills. The technique that is not welcomed in the well balanced scorecard is the one in regard to driving management responsibility to the least expensive level. This technique was not included since there requires to be a balance in duty through the organisation. Worker targets and rewards are closely connected to the efficiency of the division; more responsibility provided to personnel at lower levels might increase the possibility of supervisors setting strategies for their own benefit and department.

This might cause discrepancies between organisational objectives and the objectives set by management for a particular department.

New measures that requirement to be developed and included in the balanced scorecard are return on research study capital, item profitability, product development time, number of items under advancement, and number of employees participating in training programs.

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The steps established need to be straight associated to the goal and have the ability to supply feedback for that specific area.

(b) A Balanced Scorecard developed for the organisation will differ to one that is particularly developed for a certain department in an organisation. The objectives of an organisation as a whole are marginally different to the objectives that are set for a division or department. Organisational goals which are statements that articulate what the organisation intends to accomplish will consist of all of the objectives throughout the different divisions of the company; where as divisional objectives are aimed clearly at that division.

This may lead to various steps used in the scorecards to assess efficiency associating with the particular goal.

For example, Chadwick Inc. operates in many businesses including personal consumer products and pharmaceuticals. The organisations overall objective is to produce high quality products and get them to the market faster at lower costs. For its part, the Norwalk Pharmaceutical Divisions objective is to increase the yield of new products and to reduce the time and costs of the product development cycle. This divisional objective becomes a part of the company’s current objectives and is the objective that is focused on when developing the divisional scorecard.

The divisional balanced scorecard was decided by the president of Chadwick Inc. to be developed in a way ‘that was right for the division’. This decentralised decision-making and authority approach may create conflict between divisional scorecards and those of the corporation. This approach to developing a divisional scorecard may give rise to negative consequences. Managers may focus too narrowly on their own units performance and strategies rather than attaining the overall organisations goals. It could also lead to inconsistencies at the organisational level.

The advantages of decentralisation outweigh its limitations and should be adopted in the organisation. However, to overcome the conflict of discrepancy between organisational and divisional scorecards, top management needs to allow for decentralisation only to a certain extent and ensure that each division is being mindful and taking into consideration the overall organisational objective.

(c) The business strategy of a company or division is used to illustrate how all the individual activities are coordinated to achieve a desired result. Developing a strategy is vital as it is used to set the overall direction of the business. The business strategy for Norwalk was developed by one individual and within a few minutes. For optimal results and clear direction, a strategy should be developed over a longer time period and the balanced scorecard should not be created until all the participants involved have a clear understanding and vision of the business. From the beginning of the project it could be said Greenfield was not committed to the development of the balanced scorecard for the Norwalk division. He did not believe how dedicated Chadwick Inc. was to the concept.

Any Balanced Scorecard project will fail if it is seen as just another “management fad”. It needs sponsorship through active communication – communication that explains why the organisation needs the Balanced Scorecard and how it will benefit both the division and individuals. During the process there was also a lack of commitment from all the members, it took them several weeks before meeting and focusing on the project. The time spent developing a balanced scorecard is important, if it is rushed it could lead to negative consequences when it is implemented.

The divisions of Chadwick were advised that only hard data (financial data) is to be used in the balanced scorecard. Financial data alone only provides short-term strategies; non-financial data offers a closer link to long-term organisational strategies. Therefore by encompassing only financial data the balanced scorecard will provide only a short-term measure to evaluate the division’s performance.