Balanced Scorecard Case Study

Case Study #1

Group 5

1. Research the balanced scorecard method. What are the objectives of the method, its advantages and disadvantages? Why did IFS switch to the balanced scorecard? Was this a good decision?

The scorecard is designed to measure multiple objectives. The first objective is to align the organization’s business activities to the long term vision and strategy of the company. Other objectives include but are not limited to improving internal and external communication. The balanced scorecard method measures the performance of the organization as compared to the company’s on-going strategic goals.

Advantages – Using a balanced scorecard approach to measure performance allows the company to tie in the day to day activities into the company’s mission while at the same time incorporates and places greater emphasis on the voice of the customer.

Disadvantages – Measureable goals with objective data is the most ideal situation. Some of the data being used in this scenario is subjective and challenging to quantify.

This was a good decision in our opinion. Financial data reflects only part of the picture when reviewing past performance. The previous technique was half- hearted and focused on a very limited number of measurements. Implementing the balanced scorecard will introduce additional goals such as customer focus metrics. The information gathered from the balanced scorecard can help place needed emphasis on the areas that necessitate more attention.

2. Analyze the choices of Karl and Michael in implementing the BSC. Are their methods “right” or “wrong”? Defend your answer.

Karl’s method was to use the question about the overall contentment with IFS. Taking an average of the 5 questions as a basis to measure performance was Michael’s plan. We feel more comfortable using Karl’s plan to utilize data as the correct method to use in this scenario. Due to the limited amount of survey questions, Michael’s average could be skewed from one low survey...