A Balanced Scorecard essay

A Balanced Scorecard One of the most important things to do in order to run a successful business is to know how your business is faring at all times. “In assessing performance, organizations should not rely on any single measure but rather on a composite set of measures that take into account the various stakeholders of the firm,” (University of Phoenix, 2005). These measures are represented on what is called a balanced scorecard. The information shown on the balanced scorecard is comprised of financial, operational, market, internal, employee, and guest perspective information among others. All of these are critical success factors which a healthy business should monitor and be aware of. How does all of this data result in being in one place for management to evaluate and make decisions with this information? Systems such as the Three P system collect data and consolidates it in one place—the balanced scorecard. The Three P system is comprised of three very specific measurement categories: people (results of associate opinion surveys), product (service quality), and profit, (University of Phoenix, 2005). This system collects the information from the categories of people, product, and profit, and sends it to the company headquarters where it will be consolidated into a balanced scorecard to be evaluated by executives. All departments should send their information, financial and otherwise to ensure an accurate scorecard. The program which consolidates all of the information for the balanced scorecard is programmed to raise red flags and alert managers to key status changes, whether positive or negative. The balanced scorecard allows managers to focus on other aspects of the scorecard unless something out of the ordinary comes up, in which case the manager is alerted so that he or she is able to address the problem. A balanced scorecard not only tells the current state of the business, it shows the past year’s sales and revenues along with future forecasts.

References: University of Phoenix. (2005). Technology Strategies for the Hospitality Industry. Retrieved from University of Phoenix, HTT 220-IT in HTT website.