3 questions

 A company that provides training, certification and consulting services to commercial, government, and non-profit organizations in applying best practices in balanced scorecard (BSC), strategic performance management and measurement, and transformation and change management has a customer success story on its website at  http://www.balancedscorecard.org/Home/tabid/36/Default.aspx. Click on the Award for Excellence link (on the right-side of the page) and read the story about Mecklenburg County, which successfully transformed the county government and positioned it for tough times. Summarize the success story and explain how it relates to what you have learned in this course this week.

Discussion Questions

1) To transform an organization like that can take a very long time; it's surprising.  A major shift like that in any organization is time consuming.  Luckily, once they are reached that point, they shouldn't have to do that again.  What steps can the county take to keep things continually balanced going forward?

2) I liked how you stated that the change Mecklenburg County had to undergo required them to not "cut their own throats" while trying to save money on a depleted budget. Do you think our government could benefit from a balanced scorecard? Do you think we already have one in place?

Answer

The Mecklenburg County case study proves the importance as well as effectiveness of balanced scorecard in providing a comprehensive and consistent approach in decision making in an organization driven by data and in sync with its vision, goals and strategies. In the beginning of the 21st century, faced by some financial crunch in the state of North Carolina, the funding given to the county was cut down significantly. This led to the challenge of managing the budget effectively without having significant impact on the county services. This is where the balance scorecard, a long term mission and vision came into play for the county.

The county established a 15 year mission and vision for the community and not just the government organization. This led to Mecklenburg’s Scorecard to be named as Community & Corporate Scorecard indicating the duality (Balance Scorecard Institute, (n.d.). There six transformation principles identified for this: Understandable, Responsible, Sustainable, Affordable, Choices & Consequences and Accountable. The leadership approach in this process was participative which involved each and every employee in it. The county branded “good governance” through M4R (Managing for results) and with this created a lot of buzz among the employees. Later in 2003, there were more cuts required and that’s when the county applied the balance scorecard results and shot down the services which did not meet the scorecard results in the last years. The next step was deciding and defining priorities. Data driven decisions played a huge role in this balance scorecard making this a success. The M4R philosophy and the scorecard has so far achieved a lot while there is still scope for a lot to be done. This has resulted in huge success and also transformed the organization.

Reference

Balance Scorecard Institute (n.d.). Retrieved from http://www.balancedscorecard.org/Home/tabid/36/Default.aspx 

Your uncle is working in a company managing their investment center. You approach him with the sales of a large piece of equipment that can help the company save money in the end. Your uncle explains to you that they can’t purchase the equipment because they don’t want their ROI to decrease in value. What will be your persuasive argument to help them see more possibilities?

Discussion Question

1)

Good.  If the new equipment you are purchasing is also going to replace an old piece of equipment, how does that impact the ROI?

Answer

I wanted to make you aware that even if the equipment saves money in the end, it decreases the ROI but still it make positive investments. Therefore, my uncle suggests that company can even rent the same equipment from someone who buys the equipment if they cannot sell it. This turns out to have positive NPV and it creates a value which can be shared by the company. My uncle is correct that he does not want to decrease its ROI because ROI helps its stay ahead in the competition. I will also tell my uncle that the current equipment’s are near their life expectancy and also allow decision makers to plan for the future and also encourage then to allocate funds for the purchases. I will also take ROI and demonstrates that purchasing equipment will make ROI positive. ROI calculations are based on how long it will take to earn back the savings generated for the cost of the investment required to purchase a piece of equipment. I would also try to convince my uncle by showing him the benefits of ROI like energy savings, efficiency, maintenance cost and business strategy etc (Stannard, (n.d.)

Reference

Stannard Aaron (n.d.). How to Calculate ROI. Retrieved from http://www.smartdraw.com/articles/blog/how-to-calculate-roi.htm