The root problem of Bank of Montreal was how they could focus each and every employee on the success of the company. BMO needed to meet the needs of the 4 shareholders: BMO shareholders, customers, employees, and communities. Case Questions
Identify the strengths and weaknesses of a balanced scorecard approach to performance appraisal?
The first strength of the BSC approach is a focus on the company’s strategic direction. A BSC approach helps management communicate the company's mission by linking performance measures to its mission and strategy. The balance scoreboard not only gives you a better idea of your workforce, but also creates better customer service for the customers involved. The balanced scorecard makes the CEO's of these companies make sure that their businesses are running accurately and if it is not, it will reflect in their pay. Thus, a good balanced scorecard identifies many cause-and-effect relationships within the business and helps employees and managers appreciate the roles of employee and task as well as the importance of each result to the overall corporate effort. The balanced scorecard method is a form of checks and balances for a company to ensure that the needs of all four shareholders are met.
Although there are many strengths to the balanced scorecard method, there are a few weaknesses. First, the balanced scorecard method might be too broad to truly judge performance. I believe that if a company deliberately tries to collect and report certain data measures then their report will most likely achieve good results. Second, I feel that BMO’s balanced scorecard puts too much emphasis on the company internally. I think that BMO should first focus on their SWOT analysis (strengths, weaknesses, opportunities, and threats) externally and then set internal performance measures that coincide with those goals. Question 2: Do you think it’s fair to base the bonus paid to BMO’s CEO on...