) “A Balanced Scorecard system provides a basis for executing a good strategy well and managing change successfully.” Demonstrate the validity of this statement by selecting an organization of your own choice and showing how strategies can be transformed into objectives, measures, targets and initiatives. You should cover all four aspects of the balanced scorecard. [20 marks]
(b) Describe how one can use Lewin’s three step process to manage change [5marks]
The ‘Balanced Score Card’ is a strategic performance management system that allows an organization to translate its Vision, Mission, Values and Strategies by providing a new framework, one that tells the story of the organisation’s strategy through the objectives and measures chosen. The balanced score card system was developed by Kaplan and Norton both Havard University professors in the early to mid 1990’s. The balanced score card uses measurement as a new language to describe the key elements in the achievement of the strategy. According to Timothy Galpin in his book ‘ Making Strategy Work’ measurable goals and objectives are one of the key success factors of making strategy work. While the score card retains financial measurements, it complements them with three other distinct perspectives:- Customers, Internal Processes, and Learning and Growth. Strategic thinking is about understanding where the organization is currently standing (situational factors), defining a vision and crafting a strategy to achieve the vision. This in itself is a transformation process of moving, or changing the organization to a desired state which is inline with its vision. The balanced score card’s emphasis on strategy i.e linking it to all activities, day to day and long term could help directors and senior management stay focused. Financial measurement alone is not adequate for a successful outcome of the organization, we require balanced information to fully assess an organisation’s success. The other weakness that financial indicators if used alone have is that these metrics are of little assistance in providing early indications of customer, quality or employee problems or opportunities. The other challenge with financial metrics is that they are a good historic measurement and indicator but lack the ability to be indicative of the future performance of the organization Financial indicators are the language likely to be understood by senior members of the organization while the lower members might not comprehend this or indicators thereof. Employees at all levels of the organization need performance data they can act on. This information must be imbued with relevance for their day to day activities. The balanced scorecard focuses on identifying and translating all of an organisation’s value creating mechanisms, including intangibles, into objectives, measures, targets and initiatives Research has proved in profit making entities that successful implementation of strategy has positive results in shareholders value. Only through the use of the balanced score card is an organization able to galvanise its members to embrace and understand its vision, and strategy since all members have a role to play in the implementation of the strategy and success is contingent upon all members understanding the vision and the resultant strategy to achieve the mission and delivery from each organization member. In order to have correct priorities the use of the balanced scorecard helps the organization to take the strategically effective and efficient route in the allocation of resources, i.e to say resources must be deployed to the strategy supporting areas to enable the successful execution of the organisation’s chosen strategy. The balanced score card evolves around four perspectives. The organisation’s vision and strategy is at the centre while the four perspectives are around it. These four perspectives are: i)
Financial :- those deliverables that would make the...
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