Business 499 SLP 1: The Balanced Scorecard and the Financial Perspective (Essay Sample)
Module 1 - SLP
The Balanced Scorecard & the Financial Perspective
The purpose of the Session Long Project is to give you the opportunity to explore the applicability of the Module to your own life, work, and place in space and time, and to experiment with the Module to see how the otherwise academically rigorous presentation of a topic may, with more or less work and/or trauma, become "up close and personal". This is done in a number of different ways -- sometimes cumulative papers, sometimes practical hands-on experimentation with a tool of some sort, sometimes reflections on a place of work or life. The common thread is personal application, aimed at demonstrating a cumulative knowledge and understanding of the course's material.
For this course, the Session Long Project will take the form of putting together background from each of the four perspectives for a balanced scorecard approach to an organization or organizational unit with which you are familiar. In the final module, you will have a go at strategy mapping. You’re not building a complete balanced scorecard -- that would be far beyond our current scope – but you’ll have a chance to see what goes into it and how it gets put together into a coordinated whole. As in the cases, you’ll be drawing on your previous course work to help.
The Module 1 assignment has two parts. First, you need to identify an organization to which you have access to at least some information concerning financial data; staffing and human resource systems; marketing and customer relations; information systems; and operations. While most material on the Balanced Scorecard is written from the private, for-profit point of view, it’s perfectly possible to use this approach with public or non-profit organizations as well.
For the second part of this assignment, consider the organization's mission and strategy from the perspective of its financial operations (from your work on the case, your previous course work, and your background reading, you should be reasonably clear what such operations are). In this section of the assignment you’ll begin to identify objectives and measures relevant to that perspective. If you’re unclear on just what objectives and measures are, here is a presentation that describes what they are and how to write them.
When you have thought about it and made your selection, please specify (2-3 pages):
- The name of your organization
- What this organization does – its mission, vision and overall strategy
- The access you have to information about this organization -- remember, you’ll need information about its financial performance, marketing, internal operations, strategy, and management systems.
Once you’re reasonably clear on what’s involved, think about your organization and its finances, and then:
- Identify at least three objectives for improving the organization's financial position, and show how they relate to the mission, vision and strategy of the organization.
- For each objective, develop at least one meaningful performance measure (metric).
- For each objective, identify at least one expected level of performance (target).
- For each objective, identify at least one new action or program that needs to be developed to ensure successful implementation of the organization's strategy (initiative).
The Balanced Scorecard and the Financial Perspective
Wal-Mart Mission, Vision and Overall Strategy
Wal-Mart is one of the top multinational corporations and retail chain stores due to its positive reputation and presence in the international markets and operations. The firm is not just regarded as one of the biggest corporations and most admired organizations in the world. Wal-Mart is a firm which takes international opportunities with seriousness and responds well to the global challenges (Issam, Marie, and Teresa, 2014). Wal-Mart’s mission is focused on the desire to become the best retail chain store with a variety of low prices and high-quality products across its international retail stores. Wal-Mart’s vision is focused on becoming the best and biggest retail firm of the world through not only providing best products but also offering efficient services. Besides that, Wal-Mart’s overall strategy is focusing on developing knowledge and skills of employees who are accountable for the work which is the key to the integrity and credibility of the company’s business.
Wal-Mart’s Financial Performance, Strategy, Internal Operations, and Management Systems
The balanced scorecard (BSC) is being used to as a strategic management system to assist the firm to align its vision and mission with its goals and strategies. The BSC is a management tool which assists in aligning employee behavior with the firm’s strategy. It is a tool that creates a framework that promotes the utilization of non-financial and financial measures to assess performance (Murby and Gould, 2005). This enables the firm to identify its strategic focus. This can be realized by balancing the four key perspectives: customer perspective, growth and learning perspective, financial perspective, and internal business process perspective to assess company’s performance (MacKay, 2004). If Wal-Mart is to achieve its vision, mission, and goals, them it must identify areas that it requires to excel and develop performance measures in such critical areas. Efficient performance measurement needs a technique which uses both nonfinancial and financial measures which are tied to the firm’s vision, mission, and objectives. One of such technique which has gained broad acceptance in measuring performance is the balanced scorecard.
BSC is a framework which links the perspectives of the firm’s four stakeholder groups to the firm’s vision, resource, mission, objectives, and performance measures. The four stakeholder groups include the following. First, stakeholders with a focus on financial perspective (investors and owners) want Wal-Mart to make improvement in financial measures such as return on investment, and net income. Secondly, stakeholders with a focus on growth and learning perspective (employees) want job satisfaction, competitive wages, and opportunities to achieve their potentials (Herbert and Robert, 2010). Thirdly, stakeholders with a focus on internal business processes (managers of Wal-Mart) want to ensure that Wal-Mart develops a cost-effective and safe way of processing and producing high-quality products. Lastly, stakeholders with a focus on a customer perspective (consumers) want high-quality products of low-cost.
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