Summary

In this article – the first of a four part series – author, management consultant and Balanced Scorecard expert Paul Niven discusses the need for a Financial Perspective in a Balanced Scorecard. The other three parts focus on the Customer, Internal Process and Learning and Growth perspectives.

Typically, the mission and vision statements of organizations do not refer to their financial aspirations. However, companies need to have a Financial Perspective so that they can answer shareholders who require a return on their investment.

Companies must ensure that a focus on customers also leads to improved financial results. Financial performance also enables investment in people, processes and technology so that customers can be served successfully.

So, how do companies know if they are performing well financially? The Financial perspective of the Balanced Scorecard gauges financial success from the perspective of a company’s shareholders and gives the company the tools to track success over time.

Summary 

When it comes to enterprise performance management and improving organisational performance, organisations have a bewildering array of approaches, frameworks, methodologies and models to choose from. Two of the most popular approaches are the Balanced Scorecard and the EFQM Excellence Model, which was created by the European Foundation for Quality Management.

This resource is a case study of Inland Revenue, an experienced user of the EFQM Excellence Model, and was created when the Balanced Scorecard was introduced in the organisation.

Summary

This resource is a case study of Inland Revenue, an experienced user of the EFQM Excellence Model, and was created when the Balanced Scorecard was introduced in the organisation.

The Part 1 of this 3 series article looked at the literature on the use of both models and the limited literature on combined use. Part 2 shows how internal research with senior directors and the department’s quality community was then undertaken to form a benchmark for any recommendations. The main research was conducted with four comparator organisations who are all noted users of excellence models and the Balanced Scorecard.

Summary

The paper demonstrates how EFQM and Balanced Scorecard models can be used together in a manner that maximises the strengths and minimises the weaknesses in the use of each. The paper also identifies critical success factors and the kind of broader strategic management frameworks necessary for successful use of the EFQM Excellence Model and Balanced Scorecard.

The final part of the series concludes by suggesting that the best practice is to use the models in a strategic management process based on solid Plan, Do, Check, Act principles actively managing the organisation.

Summary

Focused measurement of performance in the right areas plays a big role in successful performance management. However, issues like data overload, a misguided focus on routine variation, and the lack of an overarching framework that connects people, departments and operating units undermine performance measurement and performance management.

This resource, a case study, describes how the Automobile Association of the UK successfully tackled many of these issues and went on to set a new industry benchmark and provides its customers with the highest level of satisfaction of any major provider, according to the JD Power’s UK Roadside Assistance Study in 1999, involving 25,000 drivers.

Summary

The ultimate goal of enterprise performance management is to create a high performance culture. This brings into sharp focus the way companies actually manage people. Even today, however, HR managers are unable to prove the contributions they make to their companies and are hence, not a part of management teams. In this context, the article argues that a new role needs to be defined for the HR function.

The article traces the origins and development of personnel administration. Frederick Taylor’s principles of scientific management dictated the way jobs and work were defined and managed. Later, companies began to believe that a concern for employee welfare would translate into increased worker efficiency. The quality management movement carried forward this philosophy, by recognizing the importance of frontline workers in quality and consumer service.

Summary

In this article, the authors – experts in the field of strategic analysis, strategic planning and strategic initiatives – examine the relevance of the Balanced Scorecard methodology for undertaking a strategic assessment of higher education.

The authors begin by pointing out that accountability in higher education has become a challenging issue since the 1990s. Increasingly, institutions of higher learning have been required to provide performance indicators – empirical evidence of their value – to state, alumni, prospective student, and other external stakeholders. State commissions of higher education have developed “report cards” that grade colleges and universities according to their level of performance in a variety of categories. Surveys in the popular press and on the Internet rank institutions according to criteria such as retention and graduation rates, resources, and academic reputation. However, such efforts have not dramatically changed the operational performance of most major universities.

Summary

An enterprise-level Balanced Scorecard is owned by the senior team (which is responsible for strategy). To create a high level Scorecard and formulate a robust plan for strategy implementation, the initiative needs to take into consideration the people-related elements that need to be addressed at the very outset. This article, structured in a Q & A format, answers the question ‘What is the role of the HR function in creating an enterprise-level Balanced Scorecard?’