BALANCED SCORECARD

The Balanced Scorecard

The Balanced Scorecard

Introduction

Commonly, process thinking of high level is not usually considered in business schools and the processes of business schools are not usually made to fit the business models on the basis of which organizations functions. Majority of the business schools are ordered into divisions or departments that explain the functional units like that in organizations. Professors of business schools impart education on courses in finance, marketing, and operations but only a few business schools comprise of professors who preach business processes. The business schools presenting a closer view on the process are usually those with faculty in business operations, who consider processes as a subpart of operations. Regardless of the limited work done on business processes, some great contributions have been made by some business schools. These contributions include Michael Porter's effort on value chains, strategy development, and achievement of competitive advantage by companies, are imperial. Similarly, David P. Norton and Robert S. Kaplan have contributed the design of the Balanced Scorecard, a chief element that many companies, which are process-oriented, consider as very useful (Harmon, 2009).

Balanced Scorecard

The Balanced Scorecard was introduced by Dave Norton and Robert. Kaplan to offer a misplaced component and provide a bridge among the various contradictory literatures that had evolved in absolute segregation from each other (Kaplan & Norton, 1996). The literature developed on lean management and quality, emphasized upon continuous improvement activities undertaken by the employees' to minimize waste and enhance the company' responsiveness. The literature developed on financial economics, which excessively focused on measures of financial performance. The stakeholder theory was also an important variable in this regard, according to which, the firm was an intermediary making efforts to build contracts that gratified all of its diverse constituents. Hence, the authors attempted to keep hold of the valuable insights explained by the various literatures. They emphasised that process, and Employee performance are crucial for ongoing and future winning. However, Financial metrics, will enhance if a companies' performance increases. Hence, for optimizing shareholder value in the long-term, a firm has to internalize the expectations and preferences of its suppliers, customers, employees, shareholders, and communities. The main idea was to develop a more vigorous management and measurement system including both financial metrics as wadding outcomes and operational metrics as principal indicators, along with various other metrics to gauge a company's development in bringing future performance (Kaplan, 2010).

The balanced scorecard is different from other systems of strategic measurement as it is a collection of non-financial and financial measures (Lipe & Salterio, 2000). It comprises of ending measures and the performance drivers of results, connected with each other in cause-and-effect relationships. Hence, it is a feed-forward system of control which can align personal and departmental goals to on the whole strategy. It recommends four areas of measurement including internal-business-process, financial, customer, and growth and learning perspectives (Norreklit, 2000, p. 65).

Discussion

Balanced Scorecard used in hotel services

The literature reviewed for the use of balanced scorecard in hotel management shows that the reviews mad ...