Literature Review Performance Management and the Balanced...

Chapter 2 Literature Review Since the Balanced Scorecard was developed in the 1990’s by Robert Kaplan and David Norton (1992), it has gained in popularity amongst academics and practitioners. In 1990, Kaplan and Norton led a research study of a lot of companies with the purpose of exploring the new methods of performance management. The importance of the study was an increasing belief that the financial measures of performance management were not as effective as before with the development of modern business enterprise. Representatives involved in the study companies, including the researchers Kaplan and Norton, were persuaded that the reliance on financial measures of performance had an effect on their ability to create value. After†¦show more content†¦2003). Similar to Speckbacher et al. (2003), this study examines the structure of the BALANCED SCORECARD as a whole. This study is however, unique in that it addresses both the structure and use of the BALANCED SCORECARD. Kaplan amp; Norton (19 92; 1996; 2001), the originators of the balanced scorecard, emphasize that the inclusion of non-financial measures is just one aspect of the balanced scorecard, noting that there are several structural attributes that make it unique from other frameworks, such as KPI (key performance indicator) cards and stakeholder cards. Kaplan amp; Norton (1996, 2001) also suggest that its unique structure allows it to be used as a strategic tool to steer organizations towards sustained long-term profitability. They argue that simply including non-financial metrics in their performance measurement system is not enough for organizations to learn, improve, and grow. If Kaplan and Norton’s argument is correct, then companies with different levels of BALANCED SCORECARD adoption should see different results. This suggests a need to compare organizations that have different levels or numbers of balanced scorecard attributes to see if there are any differences. As well, academic studies may be m ore comparable if a clearly defined Balanced Scorecard was used. A clearly defined BALANCED SCORECARD would enable organizations and researchers to assess the level of BALANCED SCORECARD adoption which may help to explain some of the differences inShow MoreRelatedUsing Balanced Scorecard for Subcontractor Performance Appraisal1493 Words   |  6 PagesUsing Balanced Scorecard for Subcontractor Performance Appraisal S. Thomas NG, Hong Kong, China Key words: Subcontractor performance, performance appraisal, balanced scorecard SUMMARY Several influential industry reports have pointed out that a decline in construction quality and productivity could be attributed to the performance of subcontractors who are entrusted to complete the actual works, yet subcontractor performance appraisal is a much neglected subject in construction. To facilitateRead MoreThe Performance Of The Pioneer Company Essay1622 Words   |  7 PagesThe criteria for measuring the performance of the pioneer company, how the Balanced Scorecard can serve the company by the following process A Balance scorecard is a systematic approach to performance measurement that reflects the strategy of an organization into clear objectives, measures and targets. The Balance Scorecard integrates an appropriate mix of performance measures in the short and long term financial and nonfinancial performance measures used throughout the organization, based on theRead MoreSummary of Balanced Scorecard1465 Words   |  6 PagesUsing the Balanced Scorecard as a Strategic Management System Kaplan, Robert S., Norton, David P. Harvard Business Review; Jan/Feb1996, Vol. 74 Issue 1, p75-85, 11p, 3 Diagrams Robert S. Kaplan and David P. 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Business Performance Management, Vol. 5, No. 1, 2003 1 Implementing performance measurement systems: a literature review Mike Bourne* and Andy Neely Centre for Business Performance, School of Management, Cranfield University, Cranfield, MK43 0AL, UK E-mail: m.bourne@cranfield.ac.uk *Corresponding author John Mills and Ken Platts Centre for Strategy and Performance, Institute for Manufacturing, University of Cambridge, Mill Lane, Cambridge, CB2 1RX, UK Abstract: Currently, thereRead MoreA Strategic Planning And Management System Essay1245 Words   |  5 PagesNowadays, intangible assets are just as important as physical assets and the Balanced Scorecard (BSC) is an innovative approach that considers the financial and non-financial perspectives in determining the performance level of an organization. Question 1 The BSC is a strategic planning and management system designed to translate an organization’s mission and vision into a comprehensive set of objectives, performance measures and implementations in order to achieve business goals. The BSC retains