In August 2018, I had the privilege of handling an event for the Rotary Club in Accra, Ghana; during the event, I interacted with some participants on a variety of topics, the notes I made based on the discussion with one of the management consultants were on the use of Balanced Scorecard. This topic resonates with me because the first hotel I worked with, a four-star hotel, used the balance scorecard system to measure and manage performance. Back then, as staff, we didn't like the system because we felt it restricted us in the execution of our duties; we needed to follow strict rules to achieve the required results, but, as you know, with hospitality, even though we plan for service, it can be spontaneous in certain situations. Sometimes, responding to such cases makes the guest happy but hurts the department's chance of making the target because of the rigid metrics associated with the balanced scorecard system, or so we thought.
Recently, I had similar discussions with some colleagues on using the Balanced Scorecard to improve business performance. Below are the key takeaways from that discussion.
The Balance scorecard for organizational performance is interesting because it challenges the status quo for a more competitive business environment and ensures the smooth implementation of a business strategy. Almost every company has a strategy for success. Sadly, only a few can effectively execute these strategies.
Challenges with the smooth execution of strategies include managers who are not motivated to perform because their incentives are not linked to the successful implementation of the plan, probably because there is no alignment of vision with strategy.
The workforce expected to carry out the daily activities needs to understand the organization's vision and the steps to attaining that. But they cannot contribute to its success, partly because management executives who ensure that these staffs understand spend less time discussing these strategies at meetings. The few successful ones who do, do not have budgets linked to the plan. With this, performance becomes lopsided, and goals, difficult to achieve.
Balance score card which is mission-driven, is to ensure that all aspects of the business strategy and implementation are covered. In terms of achieving set goals, every part of the business is essential, there is the tendency for some organizations to focus more on financial gains, but developing all the perspectives, that is, the customer perspective, internal process, learning and growth, will lead to good financial standings which is the ultimate result expected of any business.
Per experience with the Balance Scorecard system, it is a comprehensive system or framework that covers every aspect of business operations and allows for proper performance measurement. However, it can be a rigid system if not implemented properly. For an organization to succeed using a Balance Scorecard to improve business performance, leadership must have the right attitude, unity of purpose and direction, and create the right atmosphere for all to participate.
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