#Week DQ, Assgn 7

Running head: BALANCED SCORECARD 1

BALANCED SCORECARD 5

***THREE OLD WORK HERE. I have also attached a relevant page.

Student’s Name

University Affiliation

Date

M&R Balanced Scorecard

M&R created numerous metrics. When several metrics were created employees were among the greatest beneficiaries. Their salaries were increased basing on those metrics and employees were able to earn a bonus which was up to 10 percent (Bernold & AbouRizk, 2013). One can believe that Global Oil was after improving services and by establishing metrics vis a’ vis the goal of the company could hold employees accountable and transparent in their dealing with the organization.

M&R’s implementation had strengths. The number of metrics multiplied which put into account many areas, that is, the implementation took into consideration 32 various metrics. If they failed in an area, they could benefit in another area. Secondly, incorporating the balanced scorecard made managers and employees accountable and the managers were given a chance to make wise decisions. This wise decisions always help a company to grow and earn huge profits. However, the implementation of the balanced scorecard had weaknesses (Bernold & AbouRizk, 2013). First, the organization created project teams which were composed of managers and in my opinion the company would have made teams to have employees and other different management levels. Having different positions can bring in the sharing of diverse views which are significant in service delivery. Secondly, the roll out of the balanced scorecard was poorly communicated since they just employed brochures that described the balanced scorecard. They could have looked for a better means of communication.

Yes, M&R was responsible for turning around the organization’s financial performance since the number of metrics increased meaning the organization was able to sell more and earn more money. Also, the increase of bonus to up to 10 percent indicates the organization achieved a high financial performance as a result of the M&R balanced scoreboard.

Reference

Bernold, L. E., & AbouRizk, S. M. (2013). Managing performance in construction. Hoboken, N.J: Wiley.

Assgn: Balanced Scorecard

Student Name

Course Name

Instructor Name

June 21, 2020

Balanced Scorecard

I reviewed the Case 14-1, "Global Oil" in Chapter 14 of my course text for this assignment, and commented on the presented details. I will recognize how the balanced scorecard should be enforced, including that the outcomes of this execution might relate to organizational decisions. I will also provide a thoughtful evaluation of the implementation of the balanced scorecard by M&R, including identifying program weaknesses and strengths. And also, a response to why M&R’s implementation of the balanced scorecard was responsible for turning the financial success of the company around.

M&R’s Implementation of the Balanced Scorecard

Considering the situation, it should be remembered that the balanced scorecard is ideally designed to ensure long-term stability as well as the longevity that and company wants for the future. It is a process that integrates a collection of financial and nonfinancial steps. These indicators are used to determine essential success factors for a business. M&R incurred a loss in 1990, though restructuring of the business operations in 1993 led to the transformation. Right from basic decision making to pay systems, a sequence of changes were made (Zimmerman, 2016). Almost all of the changes made were in keeping with the Norton and Kaplan strategy, i.e., Balance Score Card (BSC). Under this strategy, the organization made the following changes:

· He created small teams of top executives with creative ideas to assess the organization's performance.

· There are four perspectives under the BSC approach, notably: customer, financial, educational, and internal. In total, under these four viewpoints, 32 metrics have been defined.

· It has trained employees to adapt to the new method.

· Conduct regular customer feedback has begun, which has led to the continuous improvement of the services.

· Pay and performance were related.

Following extensive work on the strategy, the M&R management team adopted the Balance Score Card and accepted the chance of introducing a new business system. In the company, they introduced BSC, which not only earned them the first competitive edge but also made them the leader in their sector.

Strengths of BSC Program:

Holistic approach: It allows evaluation of performance overall.

Management by Objective: IT allows collaboration and understanding of the business objectives at all company levels.

Feedback and learning: It gives continuous input to operations management.

System Approach: It helps us to understand whether enhancement has been accomplished in one area at the expense of another.

Weakness of the BSC Program

· Less emphasis is placed on financial factors; attention over operation leads to long-term losses due to heavy spending.

· The majority of employees are unwilling to learn new approaches that can create obstacles to an effective approach.

· The net benefit obtained can sometimes be hard to quantify.

Adoption of the Balanced Scorecard

Yes, BSC adoption is the justification for the reversal to some degree as it gave a clear strategy to the business as to where it is going, and what factors need to be introduced to monitor and achieve the objectives. It also allowed the company to focus on its vision and assisted in turning the vision into the practice, which is imparted through the company.

Also, it helped in assessing an organization's performance and helped bridge the gap between the strategic objectives and achieving the goals. In addition to offering feedback from both internally and externally outcomes that helped improve the future organizational performance to achieve the goals set. It also served to balance the accounting statements with the performance indicators focused on three key factors, i.e., customer satisfaction, internal processes, and the innovation and development activities of the organization that influenced the company's potential financial performance. Even so, this approach can't only be given full credit. The management team has taken many additional small and major moves, such as:

· Adjusting incentive plans that led workers to receive more incentives if the organization met its pre-determined targets.

· They transformed their convenience store to become a one-stop-shop to provide consumers with a one-stop solution for food, snacks, and fuel.

With the implementation of BSC, performance assessment of the company has changed, but this was not the only justification for the change.

References Zimmerman, J. L. (2016). Accounting for Decision Making and Control (9 ed.). McGraw-Hill Education. Retrieved from https://books.google.co.in/books?id=Cs0vjwEACAAJ&dq=Accounting+for+Decision+Making+and+Control&hl=en&sa=X&ved=2ahUKEwixuafprpLqAhVYwjgGHbaUAk0Q6AEwAnoECAIQAg

Impact of implemented Scorecard on overall performance of a Global Oil Corporation

Institution:

Name:

Date:

Evaluation of implementation of the balanced scorecard

In the case study given, it shows that the oil corporation was ranked the last among its peers in the year 1990s. This clearly shows that the company was experiencing either management problems or poor skills and approach towards issues concerning the organization. This acted as a stepping stone for its competitors who took the first four positions in terms of financial performance when the companies were ranked.

During this time, the company used to make annual financial drainages of $500million from the corporation. During that time, the company’s corporate strategy was a centralized functional organization.

In the year 1993, the company decided to reorganize its corporate strategy from a centralized functional organization into a decentralized one, with 17 geographic business units and 14 service companies.

Strengths of the new strategy

· Better focus on customers. This strategy gave a keen focus on all types of customers without ignoring any of them, representing the interests of all classes of customers

· It has better marketing strategies that are well tailored to the local markets giving local managers more authority when it comes to the process of decision making.

· Convenience storage; it offered one stop shopping for gas and snacks

· It focused on those customers who are less sensitive to prices whose purchasing power was inelastic.

Weaknesses of the new corporate strategy

· Problem of mismanagement of the decentralized organizational operations

Adoption of Balanced Scorecard

Upon the adoption of the balanced scorecard, the overall performance of the organization improved. In the financial year 1995, the company rated the fifth largest company in US with a total of 7,700 Global-branded service stations selling about 23million gallons per day, this contributed to about 7% of the nations gasoline. This was quite amazing for the company.

These positive changes can be attributed to the adoption of the new balanced scorecard. This is possible for the turnaround in the financial performance of the Global oil company.