THE INTERNAL BUSINESS PROCESS

The Internal Business Process



The Internal Business Process

Introduction

The Balanced Scorecard is a managerial accounting system designed for internal use in order to align different facets of a business with its overall vision and strategy. The topic of accountability and performance measurement has become urgent for nonprofit organizations as they encounter increasing competition from a proliferating number of agencies, all competing for scarce donor, foundation, and government funding.

Duke Children's hospital used Four Management Processes of the Balanced Scorecard that surrounds addressing the fundamentals of business objectives including impact on stakeholder (Meliones et al., 2001). Duke Hospital decided to use the balanced scorecard to measures organizational performance using financial and non-financial measurements in four perspectives: financial, customer, internal process, and learning and growth. The approach quickly evolved into a new system for describing and managing strategy (Niven, 2004). The financial perspective provides a clear long-run objective, but it provides a constraint rather than an objective for nonprofits. Although Duke Hospital certainly monitor its spending and comply with financial budgets, its success cannot be measured by how closely they keep spending to budgeted amounts, or even if they restrain spending so that actual expenses are kept well below budgeted amounts (Meliones et al., 2001). The subject of performance measurement for Duke Children hospital is extensive but generally inconclusive.

Several forces highlight the importance of partnering with employees. Employees want to know that they are working for an organization that is contributing value to the world, that society benefits from the mission and strategy of their organization and its products and services (CQI, 2008). The Balanced Scorecard provides a simple, clear message about organizational strategy that all employees can understand and internalize in their everyday operations. For these scorecards to be effective, however, everyone in the organization must understand the strategies for their unit, division, and the overall corporation. Employee skills and capabilities enhance internal processes and customer value propositions that are at the heart of the strategy (CQI, 2008). The strategy map reveals the strategic chain of cause-and-effect relationships that eventually links investment in employee skills to improved financial performance.

Analysis

Balanced scorecard Duke University Children's Hospital Strategies focused on creating value. This resulted in shifting the value proposition from managing tangible assets to knowledge-based strategies that created and deployed an organization's intangible assets, including customer relationships; innovative products and services; high-quality and responsive operating processes; skills and knowledge of the workforce; ...