NOTE: Free essay sample provided on this page should be used for references or sample purposes only. The sample essay is available to anyone, so any direct quoting without mentioning the source will be considered plagiarism by schools, colleges and universities that use plagiarism detection software. To get a completely brand-new, plagiarism-free essay, please use our essay writing service.
One click instant price quote
Balanced scorecard (BSC) has become the subject of active discussions since recent times. The reason for this is in the growing role of strategic management and performance in the making the enterprise profitable and stable. Thus, the aim of this work is to discuss the issues of BSC and strategy implementation on the basis of the three readings according to the references. Balanced Scorecard According to Kaplan & Norton (2001), it is noted that the bigger portion of the organization executives under their research have named the two aspects, without which it would be impossible to use the Balanced Scorecard (BSC) for achieving the breakthrough performance these are alignment and focus. However, it is under question, where this focus should be done, and of course it depends on the kind of activity the company leads and the key points to be amended or achieved through its strategy development.
Though the use of the BSC has usually been the preference of large companies, small enterprises may also use it for their performance breakthrough. The example of AMD as the company which was able to gain a considerable portion of the microprocessors market, the use of BSC has become a decisive step far not managers were ready to accept the future changes and the difficult path to these changes, which finally worked for the better. (Kaplan & Norton, 2001) According to the article, In truth, some of us didn't like the idea at first, " Ruiz says. But a year later, the results are clear. While Intel execs scoff that AMD's surprising surge reflects only its success selling high-end server chips, DiFranco's retail strategy was a major factor in boosting AMD's worldwide share of mainstream microprocessors to 15. 3 % in the first quarter, from 5. 7 % a year earlier, according to International Data Corp. (Edwards, 2006) Consumer-centric approach is a very interesting aspect of implementing strategies for better enterprise performance. However, it should be decided whether the company used this consumer-centric approach for its performance breakthrough.
Kaplan & Norton state, that through the use of the BSC it is possible to understand the main principles and forces which may drive their customers and the enterprise itself towards their objectives. AMD was not totally concentrated on satisfying consumer demands, though certain steps have been made at the beginning of their global strategy implementation the needs which Intel was not able to satisfy, were satisfied by AMD, giving it an opportunity to expand the business and gain consumers trust. In fact, and as the article shows it, there were some cases, which may be called luck and which also moved AMD towards becoming the second largest microprocessor supplier on the market. What is meant here is the case when Intel experienced the shortage of details, which AMD was able to supply and used this opportunity for its benefit. Thus, in my opinion, the measures described in the article were not 100 % consumer-centric. It cannot be argued, that measuring the business from the point of view of consumers has benefited its performance.
It is logical, that as soon as the needs and desires of consumers are used with the account of other beneficial company factors, this always works for the better performance. Kaplan and Norton note, that the use of the BSC may be linked with the customer profitability research, which will include the measurement of acquisition, satisfaction, retention, account share, and market share. But companies also need to measure whether their loyal, satisfied customers are profitable. Balancing measures such as customer profitability or percentage of unprofitable customers help managers ensure they are not improving their customer measures at the expense of high-level financial profitability measures (Kaplan & Norton, 2001) Measuring business from the consumers viewpoint is beneficial, but it should be remembered that such actions should be performed on the basis of objective picture and market share of the company, and the results of customers evaluation are to be combined with that of objective data. AMD has not actually spent too much time for measuring consumers demands and opinions. This has been done through analyzing the work of their competitors, as Intel, and understanding the needs which Intel's customers were displaying thus to create the desired product, which at the same time could not be created by Intel itself.
On the corporate sales front, Intel for the past two years has been caught flat-footed by demands from customers for chips that are both powerful and energy-efficient. Its engineers instead worked on the high-end Itanium server chip, which required customers to rewrite software if they were to get the most out of it, while AMD's Opteron did not. (Edwards, 2006) This was the first serious step towards success. For the better performance of the company, the BSC should be linked with the following aspects: compensation system for the employees; alignment of the organizational units in one strategy; education and communication; defining individual objectives on the basis of strategic goals; interactive management meetings. (Like & Salterio, 2000) Conclusion In the light of ongoing changes in the overall management approaches among large companies, the smaller ones also display their striving for better performance through the BSC use, though its implementation needs through preliminary research and strict control over its operation. The use of BSC as a means of improving the companys performance must be combined with other important strategic steps noted in this work. Evaluating the enterprise from the consumers viewpoint is important to the reasonable extent and should not be underestimated.
It is evident, that the use of the BSC in strategic management of different companies will become more popular, as it obviously works for the better companys performance, but the approaches towards the BSC use should be somewhat changed. References Edwards, Cliff. (2006). AMD: Chipping away at Intel's head. Business Week, 3988, 72 - 73 Kaplan, R. & Norton D. (2001). Transforming the balanced scorecard from performance measurement to strategic management. Accounting Horizons, 15, 147 - 152 Like, M. & Salterio, S. (2000).
The balanced scorecard: Judgmental effects of common and unique performance measures. The Accounting Review, (July): 283 - 298
Free research essays on topics related to: high end, large companies, balanced scorecard, strategic management, market share
Research essay sample on Balanced Scorecard Strategic Management
