The Differential Improvement Effects of the Strategy Map and Scorecard Perspectives on Managers' Strategic Judgments

2012 ◽  
Vol 87 (3) ◽  
pp. 899-924 ◽  
Author(s):  
Mandy M. Cheng ◽  
Kerry A. Humphreys
Keyword(s):  
Performance Measures ◽  
Balanced Scorecard ◽  
Data Availability ◽  
External Information ◽  
Strategic Objectives ◽  
Information Relevance ◽  
Strategy Map ◽  
And Performance

ABSTRACT This study examines the effect that two key balanced scorecard (BSC) framework elements—causal linkages between strategic objectives in the strategy map and performance measures categorized by scorecard perspective—have on managers' ability to interpret the strategic relevance of external information and use this information to evaluate the appropriateness of an organization's strategy. We conduct two experiments, finding that presenting a set of strategic objectives as a strategy map enhances both managers' information relevance and strategy appropriateness judgments. We attribute this improvement to the explication of causal linkages between objectives in a strategy map. In contrast, presenting performance measures categorized by scorecard perspective only improves managers' strategy appropriateness judgments when the managers are provided with a set of strategic objectives that are not presented in a strategy map structure. Our study contributes to the literature by demonstrating that these two elements of the BSC framework have differential decision-facilitating impacts on managers' strategic judgments. Data Availability: Data are available from the authors upon request.

Determining quantitative targets for performance measures in the balanced scorecard method using response surface methodology

2018 ◽  
Vol 56 (9) ◽  
pp. 2006-2037 ◽  
Author(s):  
Sorour Farokhi ◽  
Emad Roghanian
Keyword(s):  
Response Surface Methodology ◽  
Performance Evaluation ◽  
Response Surface ◽  
Performance Measures ◽  
Balanced Scorecard ◽  
Decision Makers ◽  
Content Type ◽  
Strategic Objectives ◽  
Strategy Map ◽  
Optimal Values

Purpose The purpose of this paper is to propose a quantitative methodology for setting targets in the framework of Balanced Scorecard (BSC) in order to achieve vision and goals. Design/methodology/approach Response Surface Methodology is proposed to find the significant relationships that should be included in the strategy map and the optimal values of performance measures are assessed by using the desirability function-based approach of RSM. The proposed method was created by reviewing the existing literature, modeling the problem, and applying it in an oil company. In fact, RSM is used to execute the design matrix, analyze the collected data, extract models, analyze the results, and optimize the procedures that generate multiple responses. Findings By applying this methodological design, a clearer picture of the relationships between strategic objectives is obtained and the influence of strategic objectives on one another is determined. Afterward, optimal values for performance measures are determined. Research limitations/implications This paper proposes a framework for constructing a strategy map and setting quantitative targets to translate the goals and strategies into corresponding performance measures and targets. Also, this paper presents a case study to demonstrate the applicability and effectiveness of the proposed approach. However, RSM-based techniques require a greater amount of data to generate more accurate results. Although the advent of the Information Age has forced organizations’ decision makers to provide sufficient information and data for business analysis, the data requirements of RSM-based techniques are met. Practical implications In practice, the process of setting targets for performance measures can be challenging in terms of reaching a consensus between managers and decision makers. The findings of this paper can offer a new approach for performance evaluation based on the BSC which allows the organization’s decision makers to reach a more accurate picture of the relationship model between organization goals and those objectives within the BSC. It also demonstrates how decision makers can be guided in the process of defining performance target values in the BSC method. Originality/value Reviewing the literature on setting quantitative targets within the framework of the BSC showed no prior study in which RSM is used. This approach has two main contributions: the associations among strategic objectives are investigated and obtained in an effective way which analytically identifies the direction and degree of the relations among the performance measures. Considering the performance evaluation structure based on the BSC, quantitative targets have been determined to help in achieving the long-term goals of the organization. The application of the proposed method in a company showed that the contributions of this research are not only theoretical, but practical as well.

Causal Inference in Judgment Using the Balanced Scorecard

2019 ◽  
Vol 32 (2) ◽  
pp. 201-224
Author(s):  
Kristian Rotaru ◽  
Dennis D. Fehrenbacher ◽  
Min Hui Liang ◽  
Axel K.-D. Schulz
Keyword(s):  
Balanced Scorecard ◽  
Data Availability ◽  
Strategic Objectives ◽  
Performance Outcome ◽  
The Balanced Scorecard ◽  
Strategic Objective ◽  
Generic Strategy ◽  
Strategy Map ◽  
Financial Performance Measures ◽  
Psychology Literature

ABSTRACT One of the potential threats to the effectiveness of the Balanced Scorecard (BSC) is that managers over- or underuse particular perspectives of the BSC. Specifically, we investigate the effects of (1) the presentation of strategic objectives (generic strategy map versus strategic objective list), and (2) the performance outcome patterns (positive versus negative outer perspective) across the performance measurement perspectives of the BSC and find support that is consistent with the violation of the causal independence assumption (VCIA) in the psychology literature (Rehder 2014). Our findings show that the presentation of the strategic objectives and the performance outcome patterns interact significantly affecting performance evaluation outcomes. Two follow-up experiments provide further support for the VCIA observed in the main experiment by ruling out an alternative explanation that managers simply place a greater emphasis on financial performance measures. Data Availability: Data are available from the authors upon request.

scholarly journals Strategic Planning dan Balanced Scorecard serta Penerapannya pada Restoran Cepat Saji Wendy’s

2018 ◽  
Vol 10 (1) ◽  
Author(s):  
Felisia
Keyword(s):  
Strategic Planning ◽  
Balanced Scorecard ◽  
Fast Food ◽  
Global Market ◽  
Strategic Objectives ◽  
Planning Strategy ◽  
Food Industries ◽  
Balanced Scorecards ◽  
Strategy Map ◽  
And Performance

Organizations need to improve their performances in order to compete in global market. To improve performance, organizations need strategies and performance evaluation measurements. Strategies must be allied within the industry which the organizations competed in. Strategies are formulated by evaluating external factors such as opportunities and threats, and internal factors such as strengths and weaknesses. After determining strategies, organizations formulate strategic planning to implement the strategies determined. Organizations also design strategy maps and balanced scorecards to describe how they could create value by connecting their strategic objectives. Fast food industries have grown in the past years. According to QSR Magazine in 2012, Wendy’s is one of the top ten highest rated food chains, next to McDonalds, Kentucky Fried Chicken, Burger King, Pizza Hut, Subway, Dominos Pizza, Strabucks, Dunkin Donuts,andDairy Queen. This article analyzes strategies, strategy map, and balanced scorecard in Wendy’s. Through this article, readers will know the importance of strategic planning, strategy map, and balanced scorecard for organizations.  Keywords: Strategic Planning, Strategy Map, Balanced Scorecard 

scholarly journals Analisis Pengukuran Kinerja Perusahaan PT XYZ dengan Menggunakan Metode Balanced Scorecard

2019 ◽  
Vol 1 (1) ◽  
pp. 26
Author(s):  
Yakobus Teofilus ◽  
Anas Lutfi
Keyword(s):  
Human Resources ◽  
Balanced Scorecard ◽  
Swot Analysis ◽  
Strategic Alignment ◽  
Business Environment ◽  
Strategic Objectives ◽  
Financial Perspective ◽  
Strategy Map ◽  
And Performance ◽  
Strategic Outcomes

The business environment today in Indonesia is shifting to a whole new level of measuring its performances. Rather than only one financial perspective which causes evaluating the customer's needs, the internal processes, and the human resources separately, the company must have a comprehensive tool to link its vision and missions into strategies that can be implemented and measured. This research aims to analyze and explore the linkage of vision, missions into strategy map, also a measurement of performances at the company using SWOT analysis, TOWS analysis, IE matrix, and Balanced Scorecard analysis. This research presents that balanced scorecard measurement could give benefits by exploring the non-financial perspectives that enable the company to create strategic alignment between strategic objectives that link the company’s vision and missions into strategic outcomes and performance driver so can boost the company’s performance.

Supply Chain Performance Measurement and Organizational Alignment in the Digital World

2019 ◽  
pp. 128-154
Author(s):  
Ehap Sabri ◽  
Rohan Vishwasrao
Keyword(s):  
Supply Chain ◽  
Performance Measurement ◽  
Balanced Scorecard ◽  
Maturity Model ◽  
Maturity Models ◽  
Strategic Objectives ◽  
The Balanced Scorecard ◽  
Digital World ◽  
Road Map ◽  
And Performance

The authors describe how organizations can leverage the maturity model approach in conjunction with foundational concepts of perspective-based performance evaluation models like the balanced scorecard (BSC) to define a comprehensive performance measurement framework. A maturity model by design provides a road-map to the next level of performance. In this chapter, the authors propose using maturity models as a structured way of identifying current capability or maturity level of any supply chain. The authors provide guidance on selecting the right “causal linkages” between supply chain objectives and performance measures. They then define a mechanism for specifying even more granular definitions of measures linked to strategic objectives, as the level of maturity progresses. In this chapter, the authors survey widely used supply chain/business process maturity models and current practices related to measuring operational metric. And then present a tiered framework for operational metric alignment and KPI governance based on perspective-based modeling design principles.

The Fifth Perspective

2010 ◽  
pp. 2378-2388
Author(s):  
Preeti Goyal ◽  
Bhimaraya A. Metri
Keyword(s):  
Performance Measurement ◽  
Performance Measures ◽  
Balanced Scorecard ◽  
Business Process Outsourcing ◽  
Organizational Boundaries ◽  
Strategic Objectives ◽  
The Balanced Scorecard ◽  
Measurement Framework ◽  
External Relationships ◽  
New Perspective

Today, alliances, collaborations, and networks are synonymous with strategy. Business process outsourcing (BPO) is one such type of alliance. With increasing reliance on outsourcing, the organizational boundaries are blurring. The implications for the client organization can be tremendous, as it now relies on an outside organization to fulfill its operational objectives. Currently, there is no single framework that can effectively measure performance for BPO arrangements. In its present form, the balanced scorecard (BSC) only addresses the performance measurement needs of a single enterprise and any perspective on any external relationships is completely missing. The traditional BSC does not suffice as a performance measurement framework for BPO. While both the client and the vendor can use a BSC for their respective organizations, the strategic objectives of the organizations may not be met. In this article the authors propose a new perspective as an extension to the BSC, namely, the goals alignment perspective. Goals alignment of the two organizations will enable creation of performance measures that will help participating organizations to achieve their respective goals.

scholarly journals Strategy Map dan Rancangan Balanced Scorecard PT. DPI

2018 ◽  
Vol 7 (2) ◽  
pp. 117
Author(s):  
A Fakhri Arifyanto
Keyword(s):  
Balanced Scorecard ◽  
Customer Relationship ◽  
Strategy Development ◽  
Strategic Objectives ◽  
The Balanced Scorecard ◽  
Strategic Issues ◽  
Strategic Objective ◽  
Financial Perspective ◽  
Strategy Map ◽  
Process Perspective

This research aims to compile and designing Strategy Map and Balanced Scorecard on PT. DPI in order to achieve the objective of becoming an international organization or world class company.  According to David P. Norton which had been quoted by Mathews (2007), Balanced Scorecard is precise methodologies to develop measurement which is capable to describe the organization’s strategy.  Development of Strategy Map is the key to design effective Balanced Scorecard. The analysis result stated that the Strategy Map of PT. DPI could be compiled by virtue of the strategic issues in the corporate level, meanwhile for the Balanced Scorecard design consists of four perspectives in which financial perspective to improve the ROI of strategic objective by increasing revenue from existing product and new product.  Customer perspective, with the strategic objective of customer satisfaction, increased market share by retaining existing customers and add new customers.  Internal Business Process Perspective, with a strategic objective of developing superior products, innovative and sophisticated, improved customer relationship management.  Learning and Growth Perspective, with strategic objectives to improve the quality, professionalism of human resources DPI, to develop a conducive climate in DPI (improve DPI climate).    

scholarly journals PENILAIAN KINERJA PERGURUAN TINGGI ISLAM DENGAN BALANCED SCORECARD AGAR TERWUJUD LEMBAGA PENDIDIKAN ISLAM BERBASIS MAQASID SYARIAH

2017 ◽  
Vol 8 (2) ◽  
pp. 121-131
Author(s):  
Zuraidah Zuraidah ◽  
Esy Nur Aisayah
Keyword(s):  
Organizational Performance ◽  
Internal Control ◽  
Balanced Scorecard ◽  
Performance Measure ◽  
Strategic Objectives ◽  
Internal Process ◽  
The Balanced Scorecard ◽  
Financial Perspective ◽  
Process Perspective ◽  
And Performance

In improving organizational performance, alignment an organizations and individuals in the organization is very important. Balanced Scorecard is one of the alternative performance measure that aims to combine the performance measures of financial and non-financial. Inspired by Kaplan and Norton, the concept was developed in four perspectives: financial, customer, internal process and learning and growth. This article discusses how to build a balanced scorecard, include determining the strategic objectives, measures, targets, initiatives, and implementing the balanced scorecard in public organizations. The performance assessment of Islamic Universities have: 1) strategic targets financial perspective: the ability to obtain funding and cost efficiency, 2) strategic objectives perspectives of stakeholders, namely the satisfaction and pride for students, 3) strategic objectives of internal process perspective is a internal business portal, process and policy procedures, financial systems and reporting, internal control and performance measurement, research and community service quality, 4) strategic objectives of learning and growth perspectives improve the professionalism of human resources, improve the quality and infrastructure facilities. Islamic university has 21 strategic objectives in the four perspectives of the balanced scorecard. As well as the maqasid syariah used as an indicator both in aligning the results of an assessment of the performance of the Islamic universities.

Redesain Balanced Scorecard Strategy Map Berdasar Konsep KPI dan KRI

2013 ◽  
Vol 2 (2) ◽  
pp. 57
Author(s):  
Vivi Triyanti ◽  
Marsellinus Bachtiar ◽  
Carlos Yohan Rafavy
Keyword(s):  
Balanced Scorecard ◽  
Performance Indicator ◽  
Application Development ◽  
Strategic Objectives ◽  
Process Indicators ◽  
Catholic University ◽  
Balanced Scorecards ◽  
Strategy Map ◽  
Key Indicators ◽  
Internal Business Process

<p class="Default"><em>Abstrak</em> <strong>- Tulisan ini terkait dengan penelitian mengenai pengembangan manajemen dashboard di Fakultas Teknik Unika Atma Jaya. Pada penelitian sebelumnya telah dihasilkan rancangan peta strategi yang memuat tujuan-tujuan strategis (<em>strategic objectives</em>) dan indikator (<em>lead dan lag</em>) dari FT Unika Atma Jaya (UAJ) yang terbagi dalam empat perspektif <em>balanced scorecard</em> (BSC), yaitu:  Perspektif Pelayanan, Perspektif Pelanggan, Perspektif Proses Bisnis Internal, serta Perspektif Pembelajaran dan Organisasi. Peta tersebut kemudian direklasifikasi lagi sehingga lebih sesuai dengan konsep indikator kinerja (<em>Performance indicator </em>– PI) dan indikator hasil (<em>Result Indicators </em>– RI).  Terdapat 8 indikator proses yang diubah letaknya menjadi indikator hasil. Lebih lanjut, dari 120 indikator, terpilih 35 indikator yang dinyatakan sebagai KPI dan KRI, dan akan digunakan sebagai input di pembuatan aplikasi manajemen <em>dashboard</em>.</strong></p><p><strong><em> </em></strong></p><em>Abstract <strong>- </strong></em><strong>The paper is related to research about dashboard management development in Faculty of Engineering, Atma Jaya Catholic University of Indonesia. Previous research has resulted a strategy map with subsequent strategic objectives and indicators (lead and lag) for the Faculty of Engineering, which comprises of four Balanced Scorecards (BSC) perspectives as follows: Service, Customer, Internal Business Process, and Learning and Growth. The map then reclassified so that it fits to Performance indicators (PI) and Result Indicators (RI) concepts. which at the end of the day will be the basis for choosing key indicators (KPI and KRI). Finally, there are 8 process indicators that relocate to result indicators. Further, from 120 indicators, 35 indicators are chosen as KPI and KRI, which will be used in the next step of dashboard management application development.  </strong>

Behavioral-Economic Nudges and Performance Measurement Models

2014 ◽  
Vol 27 (1) ◽  
pp. 27-45 ◽  
Author(s):  
Mary A. Malina ◽  
Frank H. Selto
Keyword(s):  
Performance Measurement ◽  
Balanced Scorecard ◽  
Empirical Support ◽  
Measurement Model ◽  
Data Availability ◽  
Behavioral Economic ◽  
The Balanced Scorecard ◽  
Measurement Models ◽  
Economic Framework ◽  
And Performance

ABSTRACT We describe the context wherein a Fortune 500 company's performance measurement model (PMM) has endured and evolved over a 15-year period. The PMM's tenure and continued importance refute the alleged faddish nature of PMMs such as the Balanced Scorecard, at least in this case, and allow identification of factors that add to theory about PMM longevity. We use a behavioral-economic framework and qualitative and quantitative data to examine the mechanisms behind this successful PMM. Aspects of the way the PMM is designed and implemented appear to enable the company using the PMM to exploit or mitigate common behavioral heuristics and biases in decision-making. The PMM helps manage cognitive load in a way that is consistent with the company's priorities, and it manages biases by allowing the company to frame performance information in ways that nudge managers toward strategically important results and risks. The behavioral-economic connection might be a reason why this PMM, and perhaps others, endures. Thus, this study adds to and presents preliminary empirical support for testable behavioral-economic PMM theory. Data Availability: Use of all data collected for this study is regulated by a strict nondisclosure agreement, which requires the researchers to protect the company's identity and its proprietary information.

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