Chapter: Business Science - Managerial Behavior and Effectiveness - Designing The Managerial Job

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Balanced Scorecard

— New Approach to strategic management was developed in the early 1990‘s

Balanced Scorecard

 

—    New Approach to strategic management was developed in the early 1990‘s


—    Dr.Robert Kaplan, David Norton ( HBS)

 

 

—    Recognizing the weakness and vagueness of previous management approaches

 

—    This approach provides a clear prescription as what companies should measure in order to balance the financial, customer , learning & growth and internal business process

 

—    The balance scorecard is a management system that enables organizations to clarify their vision and strategy and translate them into action

 

—    It provides feedback around both internal business process and external outcomes in order to continuously improve strategic performance & results

 

—    Companies must make to create future value through investment in customers, suppliers, employees, process, technology, innovation

 

—    The balance scorecard suggests that we view organization from four perspectives and to develop metrics, collect data and analyze it relative to each of these perspectives

 

1. Learning & Growth Perspective

 

—    Includes employee training, corporate cultural attitudes related to both individual & corporate self improvement

 

—    In knowledge- worker org , People – the only repository of knowledge are the main resource in the current climate of rapid change in technology

 

—    Knowledge workers has be put in continuous learning process

 

—    They constitute the essential foundation for any success of organization

 

—    Learning is more than training

 

2. Business Process Perspective

 

—    Refers to internal business process

 

—    Allows the managers to know how well their business is running and whether its products and services conform to customer requirements

 

—    Designed by person who know the process intimately

 

Two kinds of business process

 

—    Mission oriented processes

 

—    Support processes - benchmark

 

3. Customer Perspective

 

—    Realized the importance of customer focus and customer satisfaction

 

—    Poor performance in this perspective indicates the future decline

 

 

—    Developing metrics for satisfaction – customers should be analyzed in terms of kinds of customer, kind of process which we are providing a product or service to those customer groups

 

4.Financial Perspective

 

—    Timely & accurate funding data will always be a priority

 

—    Enough handling and processing of financial data

 

—    With the implementation of a corporate database, more process can be centralized and automated

 

—    Risk assessment and cost- benefit data also should be added

 

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