The article provides case studies of three SMEs: Hyde Park Electronics, Futura Industries, and Southern Garden Citrus and their use of Balanced Score Card to improve consumer relationship. The authors claim that though more than 50% of Fortune 1000 companies use the BSC, their use in SMEs is limited at best, and present the case studies to show how the same can be adapted to be used in smaller companies.
The claim is that companies are good at developing mission statements and strategies but they are poor at implementing those strategies, and poor at measuring the impact of those strategies. BSC offers a way out by linking the mission to the strategies, and then translating those strategies into operational objectives and measures. It manages this by focusing on four perspectives, namely financial, customer, internal processes, and learning and growth. The critical success factors created in each perspective are then aligned with internal and external factors, and both short-term and long-term goals.
HYDE PARK ELECTRONICS
The company is a family-owned business that produces ultrasonic proximity based sensors and is based out of Dayton, OH. The CEO Vincent Lewis believes in keeping all aspects of the business in balance since it is easy to lose track of the bigger picture and in the process lose business. Since the adoption of BSC they have moved from a low volume producer with a very narrow set of consumers to a company that sells various high volume sensor lines through a big distribution network. A breakthrough technology changed the focus of the company and became the savior product of the company. With the introduction of a new product the company's strategy shifted to a penetration sales model and the company star...
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... together the internal and external factors and making the supply chain more efficient.
One important way in which the companies could have improved their performance was by getting directly involved in measuring customer satisfaction. Customers may buy a product if they don't have access to alternatives, but that does not necessarily mean that they are happy with the product. Two out of three companies seem to have missed this point. If you live in a neighborhood that has only one coffee shop and the store thinks that you are happy just because you come there is not a right way to look at things. It might be entirely possible that you come there since you do not have anywhere else to go. If the companies started focusing on these aspects it is very likely that they will be in a position to further improve their efficiency and also make customers more happy!
Company Overview – Caterpillar Tractor Co. was founded in 1925 and was the product of a merger between The Holt Manufacturing Company, owned by BBB HHH, and C.L Best Tractor Co., owned by DDD BBB. The company had a great demand in WWI and this lead to the first foreign operation of many to come in the future.
During his absence, with John Sculley in power, the focus shifted to maximization of profit, and product design suffered. Steve Jobs theorized that is was one of the reasons companies decline. “My passion has been to build an enduring company where people… make great products… the products, not the profits, were the motivation. It’s a subtle difference, but it ends up meaning everything”.
The balanced score card (BSC) is tool that is widely implemented by the various strategic levels of management of organizations with the aim of aligning business activities with the vision, mission, and values of the organization (Averson, 1998). BSC is used to provide a frame work that enables the strategic management to measure the performance of the organization involved. It also helps the management to identify the necessary courses of action needed to implement its strategies. BSC has four quadrants namely; the financial perspective, the customer perspective, the internal business processes, and the organizational learning and growth perspective. The priority given to these quadrants when mapping a BSC is different between
The first chapter in this book explains a business’ mission and values. When discussing the mission, Welch states that in order to create an effective mission statement, one must explain how they intend to win in that particular business. The key is profitability, “Delineate their strengths and weaknesses in order to assess when they can profitably play in the competitive landscape,” (Welch, 15). This means to define the business’ strong and weak points to evaluate where they can efficiently and profitably fit within that specific business sector’s scheme. In order to come up with the mission, one can receive input from any source, but one should especially listen to the intelligent ones from all of the different sectors. Although, it is the responsibility of the top management or whoever is held responsible for it, to put it in place, it is their “defining moment,” (Welch, 17). The mission is what a business plans to do to win and values are ...
After conducting a basic 10 year financial analysis of the company, it has become evident that even with a highly competitive market structure they are able to improve on their performance. Ranging from 2004 to 2013 financial information, the company has shown a significant increase in their sales revenue roughly $3865 million sales in 2004 to almost four time that valuing $12970 million in 2013, which was an “increase of 10.4% over the 53 week prior year” The company’s growth strategy has been to diversify its product market and make them...
For example, in January 2005 leader in the Coca-Cola Company human resource department around the world decided to decided to improve Coca-Cola overall mission after an honest assessment was made by the company top company officials. These improvements sought to improve the success, growth and structure of Coca-Cola and to better deal with the task and people of today and their relationship with independent bottlers. After following the same mission statement over a hundred years, recent concerns led to improvements to Coca-Cola mission statement called the Manifesto for Growth. The Manifesto is an overall vision of the company made up of several components, and these components ar...
The current mission, vision, and value statements are written very broadly to provide the five divisions within the company with an overall direction and strategy. Each division then interprets the strategy and goals to develop operational processes, procedures, tactics and plans to implement and achieve those goals.
A Balanced Scorecard can be defined as a “performance management tool which began as a concept for measuring whether the smaller-scale operational activities of a company are aligned with its larger-scale objectives in terms of vision and strategy” (Wikipedia 2009, ¶ 1). Scents & Things will need to develop a balanced scorecard that will assist in meeting and help define the company’s values, mission, vision, and SWOT analysis. The balance scorecard is made up of four perspectives; financial, customer, learning and growing, and internal process. This paper will define each of the four perspectives objectives, performance measures, targets, and initiatives. The paper will also show how the perspectives relate to Scents & Things vision, mission, values, and SWOTT analysis.
The balanced scorecard was introduced by Robert Kaplan, a professor at Harvard University, and David Norton in 1990. The concept was later adopted for a study on new methods to measure performance involving multiple organizations. The balanced scorecard enables organizations to measure performance by providing balance to the financial perspective. Organizations used to measure performance by measuring only the financial measurements and this did not reflect the true performance of the organization. The BSC methodology includes information about the operational measures which gives the management a clearer picture that makes it easier for organizations to plan for short and long term goals.
Mukherjee, T. K., & Pandit, S. (2009). Role Of Business Balanced Score Card (BBSC) In Performance Management. Globsyn Management Journal, 3(1), 50-55.
Do you think strategic management had contributed to the Clorox Company’s success? Why or Why not?
A successful business strategy will identify changes in the external trends in the market place. Plan out what the company’s future direction is. Set out the goals for the management team. It will identify a vision of where the company wants to be in the future. Keep all employees informed of the direction of the company.
An organisation’s mission is the back bone of all strategic decisions; the mission will have an influence on all activities performed within the organisation, because if they aren’t achieving their mission an organisation is failing. The long term strategic goals of an organisation should directly aim to achieve their mission and these goals are what performance can be measured off. Without specific goals attempting to measure performance is pointless, and identifying who or what the main focus of these goals is the key to optimisation.
Organizations use balanced scorecards as a measurement tool to determine if their strategy and strategic planning have been successful (Pandey, 2005). A balanced
Originated as low-cost manufacturer of black and white televisions in the year 1969, super sized with a semiconductor segment in 1970s, Samsung delivered massive volume of low-cost consumer electronics to domestic and OEM products to both domestic and global markets until 1993. Due to this fact, company didn’t develop global brand awareness until then. In the global arena, Samsung’s brand message was fragmented and its logo presentations were inconsistent.