Using Balanced Scorecard to Measure Organizational Performance

Assignment Instructions

Purpose of Assignment 

The purpose of this assignment is increase learners’ knowledge of ways to effectively use the balanced scorecard to measure organizational performance.

What is a balanced scorecard?

At its core, the balanced scorecard is a tool an organization can use to measure its performance. Unlike other tools that may focus just on financial measures, for example, the balanced scorecard takes many segments of the organization into account. This creates a more holistic view of the
organization’s performance without focusing too heavily on any one set of controls. The balanced scorecard generally looks at four aspects of company performance: financial, customer, internal processes, and people/innovation/growth assets. When using a balanced scorecard, a
manager will set goals in each of these four areas and measure the organization’s process against these goals.

Assignment Steps                                               

Use the four perspectives of the Balanced Scorecard and your company documents.

  • Determine the possible metrics for each quadrant for your organization.
  • Explore the website for an organization comparable to yours.
  • Determine the possible metrics for each quadrant for the organization.
  • Explore the website for an organization not comparable to yours.
  • Determine the possible metrics for each quadrant for the organization.
  • Compare metrics for both organizations versus the metrics for your organization.

Complete a 700-word summary including the following:

  • Identify the metrics for your organization.
  • Identify the metrics for the comparable organization.
  • Identify the metrics for the non-comparable organization.
  • Summarize how the metrics differ.
  • Identify potential performance gaps in your organization.
  • Recommend actions to reduce the performance gaps.

Format the assignment consistent with APA guidelines.

Sample Solution – Balance Scorecard Module

Introduction

Performance evaluation of an organization is very important in determining the organization ability to survive its challenges and to grow in the future. The best way to measure the organization performance would be by use of scorecard. Scorecard is a performance measurement tool which evaluates the organization performance on four perspectives that include financial, learning and growth, internal process and customers. This paper evaluates the performance of a selected organization which is compared with another similar organization and a different organization.

Performance Evaluation Using Scorecard

Selected Organization

The selected organization is this case is Washington State University. This is a public institution of learning which was established in 1890 and works to inspire the following generations to learn on how to solve problems. The university sparks creativity and inspire discovery among students that are civic-minded. The organization basically focuses on adding knowledge to the student who enrolls to complete any course in the institution. Below is the analysis of the organization performance using scorecard (Washington State University, 2017).

Company performance aspect Factor to be considered Goals of the organization Actual performance from the most recent figure
Finance The organization yearly profit results (organization registered losses)

Rate of enrollment application

$0

100%

-$359707806

+100%

Customer Customer satisfaction rates

Customers rate of recommendation (referral by friends)

95%

90%

80%

87%

Internal Process Process automation (rate at which the university process has been customized)

Process duplication (rate of processes employed in one activity that are duplicated in another process)

70%

35%

55%

40%

Leaning and growth Employees rate of satisfaction

Employee turnover

80%

5%

70%

7%

Performance Evaluation of an Organization Similar to the Selected Organization

The equivalent organization for Washington State University is UW Tacoma which is a university founded to server people living in urban region. It offers admission to students in a manner which transform communities and families. The university informs and impact economic development via community engaged faculty and students. It carries out research which is of direct employment to the region and community. Below is the analysis of the organization performance based on the scorecard (University of Washington Tacoma, 2017).

Company performance aspect Factor to be considered Goals of the organization Actual performance from the most recent figure
Finance The organization yearly profit results (organization registered losses)

Rate of enrollment application

$0

95%

-$681836

98%

Customer Customer satisfaction rates

Customers rate of recommendation (referral by friends)

70%

70%

57%

60%

Internal Process Process automation (rate at which the university process has been customized)

Process duplication (rate of processes employed in one activity that are duplicated in another process)

70%

30%

45%

40%

Leaning and growth Employees rate of satisfaction

Employee turnover

70%

8%

50%

15%

Performance Analysis for a Different Organization

The different selected organization in this case is Microsoft Corporation. This is the leading personal computer applications and software system developer. In addition, the company publishes multimedia titles and books, sell portable media players, computer peripherals, electronic game and offers email services. The company is also involved in other operations such as research and development and it has established a high number of research centers in different parts of the world. Below is Microsoft performance analysis using scorecard (Microsoft, 2017).

Company performance aspect Factor to be considered Goals of the organization Actual performance from the most recent figure
Finance The organization yearly profit results

Inventory turnover (division of cost of goods by average inventory)

$17000 million

17

$16798 million

14.56

Customer Customer satisfaction rates

Customers rate of recommendation (referral by friends)

85%

90%

79%

70%

Internal Process Process automation (rate at which the organization process has been computerized)

Process duplication (rate of processes employed in one activity that are duplicated in another process)

98%

10%

88%

15%

Leaning and growth Employees rate of satisfaction

Employee turnover

80%

5%

68%

8.3%

Summary of How Metrics Differ

The first two organizations are public learning institutions which were developed to offer tertiary education to American people, particularly those living in Washington, DC State. The two institutions are anticipated to run their affair effectively using the money received from the government and the university revenue. However, based on this analysis, the two organizations are in pathetic financial situation. They are currently making losses which only mean that they do not have enough money to finance their operations effectively. This could be explained by the fact that most public organizations do not focus on making profits but providing education to the students. However, this is basically impossible without enough finances. Microsoft on the contrary has recorded a high profit which clearly demonstrates that the organization has a high ability to run its operations and to advance them even further in the future without any strain. Despite of poor financial performance the two universities experiences a high level of enrolment sometimes more than anticipated.

Consumer satisfaction rate is high in Microsoft and WSU. However, it is still below the organizations anticipation. Although the Microsoft efficiency can be explained based on its net profits, it is hard to explain a high rate of customers’ satisfaction in WSU which is already facing financial crisis. However, being a government institution, it can be said that the institution has manage to separate its financial crisis with it provision of learning services.

In the internal services, the rate of automation in the two universities is considerably poor. It goes very far below the anticipated rate. The two organizations also have a high rate of process duplication. All this limits its ability to work innovatively and effectively. However, Microsoft has a high rate of automation and low processes duplication which can explain its high level of efficiency.

The rate of workers satisfaction is considerably good in Microsoft and WSU. Most workers are happy with their working environment and other human resources measures. The rate of workers turnovers in the two organizations is also considerably low compared to that of WU Tacoma. This could have highly affected the general performance in this organization.

Potential Performance Gap in WSU

Poor financial performance is one of the main challenges in WSU. Despite of learning being less profit based, the current financial situation is pathetic. Low level of automation is another main challenge facing the organization performance. This could explain the high level of processes duplication and hence low efficiency in the organization operations, include financial management.

Recommendation to Reduce Performance Gap

WSU should consider identifying effective way to manage its finances and to enhance its sources of income to increase on it revenue. It should also consider employing effective operation processes that would minimize the operation cost, to maximize on net return. The organizations should also consider improving its level of automation and refining of processes to enhance general operations management, and the process of decision making and services provision.

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