Client’s firm
Discuss About The Efficient Management And Skilled Personnel.
Every company in the entire world is happy with the efficient management and skilled personnel. In an attempt to achieve the quality output and good customer relations, they have to use different managerial tools. This report is about the efficient use of Balance Score Card in the management system. There are management tools that are very common in the field of business management. Some of them include: Activity-Based Costing and the Time Driven Based Costing. But for this firm, they have decided to use the Balance Score Card system. Most of the companies prefer the use of Balance Score Card because it has several advantages over the other management tools (Shah, Malik & Malik, 2011). The report will, therefore, look at the company that uses the management tool, the description, and features of the BSC, the effectiveness of its functionality in the chosen company. The final part of the report is concerned with the recommendations and conclusion on the use of the Balance Score Card system. Huawei is the client’s company that will be using this kind of the management tool. By use of the BSC, I believe that the management system of the company will improve. Apart from the management system, there will be the maximization of the profit and improvement in the quality of the products. This new tool is very essential in the Huawei Company because of its vast advantages over other management tools (Naranjo-Gil, Maas & Hartmann, 2009). The BSC is a management tool which does not require much training as compared to other tools available in the market. By use of this system, the company will be able to save a lot regarding the production and running costs. The report will further analyze the difference between the Business Score Card and traditional measurement performance system. The study also analyses the effective use of the Business Score Card to the Huawei Company. Huawei being one of the leading networking companies, it requires constant review of its strategic plan .This will help it in improving the overall performance and focusing on the important areas of the business.
The name of the company planning to use this new system of management is Huawei. Huawei is accompanied that is known in the market for electronics and mobile applications. For some years, the company has been dealing with the Android smartphones. Its products are used in every continent and are liked by many customers (Perkins, Grey & Remmers, 2014). The Huawei Company was founded in 1987 by a lead researcher known as Ten Zhengfei. He was an ex-military officer. The company is known as Networking and telecommunications providers all over the world. The company is based in China and has its headquarter in Shenzhen Guangdong . Huawei Company first started as a private company, and its main mission was to provide the consultation and operational services to its clients. During the early times of its formation, the company was operating within the China itself before it spreads its wings in all over the world (Rassafiani, Ziviani, Rodger & Dalgleish, 2009).
The Balanced Score Card and its Features
Currently, the company employs more than 140000. Most of its employees are majoring in the research. Around 45% of the employees are doing great work in the field of research. The Research and Design of the company is spread in most of the world’s leading business countries. Some of these countries include Russia, Canada, United States of America, Africa and other Arab countries (Rassafiani, Ziviani, Rodger & Dalgleish, 2009). The company has a variety of the products within the market. They also offer affordable prices to the customers, and this makes it be the customer friendly. Huawei Company uses the latest technology in the software development designs. New employees are given a team of the lead researcher to help them learn new skills which can improve the performance and quality of the products produced by the company.
By use of the Business Score Card, the company will be able to perform better and improve on the products. The production cost of the company will also reduce. The company has been ranked as one of the best in the field of networking and telecommunication. It had worked with some companies to achieve its objectives. Some of the companies that have worked with the Huawei Company include Vodafone-Mobile and the Motorola Company (Nørreklit, Nørreklit, Mitchell & Bjørnenak, 2012). These companies have been very useful in its development. The company of the world’s first class brains. Because of this reason, the implementation of the Business Score Card in its operation will be an added advantage to its operation. The company will spend less in training its personnel in the use and application of the Business Score Card to the system. In the field of Networking and Telecommunication, There is always a tight competition that exists between the companies that offer the service. For this reason, each company is trying to come up with the best management tool which can help in improving the overall performance of the company (Van Seters, Ossevoort, Tramper & Goedhart, 2012). The Chief Executive Officers and other management personnel must always work hard to ensure the company achieves the best . This will intern enable the company to achieve the set objectives.
The Balanced Score Card is one of the management tools that is used by some companies. Due to its efficiency, some clients /companies are trying to implement it in the management system. The Business Score Cards has a variety of features which enable it to perform a number of the functions as compared to other forms of the management tools. As compared to both the Activity Based Costing and the Time Driven Based Costing, the Business Score Card has the following features for its efficient functionality (Perkins, Grey & Remmers, 2014). The Business Score Card is the strategic and management tool that considers the non- financial aspects of the company performance (Malmi & Granlund, 2009). These may include the customer satisfaction in the business processes (Wiersma, 2009). The tool also helps in giving the clear picture of the company shortly. Such as the reduction in the customer’s services which may later boost their earnings. By use of the Business Score Card approach, the company will also take into account the potential loss that may feature in the plans of the business (Brudan, 2010). This may be caused by the poor customer relationship and satisfaction. The tool is very useful when the company has an objective in mind. In other words for the effective performance of the Business Score Card, the company must be able to set the objectives and the plans.
Features of BSC making it more useful
The Balanced Score Card was started by the following scholars. That is Dr. Robert Kaplan and Dr. David Norton. The main aim of the formation was to replace the Traditional ways of measuring the companies and cooperate performance (Haiza, Muhammad & Hoque, 2010). This management tool was started at the Harvard Business Review in the article of 1992.
The Balanced Score Card has some features which make it more useful in the management system. The system involves the collection of data and the analysis of the company’s information from the four important perspectives.
The learning and growth perspectives -this includes the knowledge and resources of the company. All the knowledge related objectives are solved under this category. The skills must satisfy the business processes at all costs (Chen, Yang, Chen, Chen & Chen, 2010). These include the quality development of the new products. The products and services must meet the customer’s need to ensure the full implementation of this perspectives.
Customer perspective-The second feature of the Business Score Card duels in the customer perspective angle. This includes the satisfaction of the customer’s needs. The customers need should always be in line with the company’s objectives and goals. The effective performance of the Balanced Score Card should be congruence with the company’s short-term and long-term goals (Yigitbasioglu & Velcu, 2012).
The third feature of the Balanced Score Card focused mostly on the financial perspective. For every company to realize a maximum profit and quality output, there must be the financial projection. This should include the operational and current expenditure of the company. The BSC will help the company to compare the past and the future financial projections of the company (Chenhall & Moers, 2015). The financial perspective feature of the Business Score Card may include the collection of the traditional financial data concerning the performance of the sales and the expenditure. Through the use of this tool, the company can understand its growth concerning the market changes. The Score Card system plays a key role in the performance of the business. This ranges from the customers self-evaluation to the overall evaluation of the company (Shah, Malik & Malik, 2011). The system is therefore very useful in the Huawei Company. The company will be able to analyze the competitors and improve the quality of its products.
There exist some differences between the balanced Core Card and the traditional performance Systems. The traditional performance system is not linked to the company’s strategic plan as compared to the Balanced Score Card. The strategy relates to the long-term strategy of the business or the company (Shah, Malik & Malik, 2011). The traditional performance system focuses mostly on the short-term goals of the company which brings the disconnection to the entire performance of the business. But for the Balanced Score Card focusses mostly on the general goals and strategy of a company for a period.
The Balanced Scorecard is considered to be an integrated form of the management system which has reduced the limitations of the Traditional performance Systems. It proves the overall view of the companies regarding their performance. The normal performance system should be with the line of the vision of the company; this is not with the traditional measurement performance system (Naranjo-Gil, Maas, & Hartmann, 2009). The traditional performance measurement system deals only with the financial performance and not the entire strategy of the company. Some of this financial performance is related to the profit that is earned from the selling of the goods. This form of performance focusses only on sole financial measures. The internal accounting reports that are focused on the system include profitability, the flow of cash, earning received from shares, the return on assets and the economic values. All these do not focus on the overall decision making since they are regarded as short-term plans (Shah, Malik & Malik, 2011).
The Balanced Scorecard (BSC) performance system focusses mostly on weaknesses that are caused by the traditional performance system. It has an addition to the strategic non-financial performance; then the traditional financial metrics which do not provide a balanced on performance checkup (Perkins, Grey & Remmers, 2014). The Balanced Scorecard performance system can make the company understand its competitors regarding the overall performance of the company. Unlike traditional performance measurement system which only analyses the results of the performance of the company. The managers can predict the future performance of the company and how to go about by the expected changes that may arise. This is not done by the traditional ways performance measurement system. Through the measurement of the performance from four perspectives, there is interdependency among the departments of the company. The performance ranges from the financial to the customer relations (Rassafiani, Ziviani, Rodger & Dalgleish, 2009). Lastly, through Balanced scorecard system, the managers can evaluate their performance, unlike the traditional performance measurement system. It focused mostly on the strategic plan while the traditional system focusses on the already gotten results of the company
The Management tool is one of the most accepted and used by the companies. Since its main objective is to help in the strategic planning of the company, the company must first have laid down objective before its implementation. By using the management tool within the Huawei Company, there will be an improvement in both the management system and the quality of the products (Nørreklit, Nørreklit, Mitchell & Bjørnenak, 2012). The Business Score Card approach is very useful to the managers. For example, they can identify all the aspect of the business they intend to monitor. The BSC helps them to have close monitoring of the business by focusing on the performance trend. For example in Huawei company, the managers will be able to focuses on the areas that need improvement and beneficial to the company (Cinquini & Tenucci, 2010). Apart from the identification of the areas that need improvement, the company is also able to understand whether the wide objective of the company is met. The company may be planning to achieve some objectives for the financial year (Van Seters, Ossevoort, Tramper, & Goedhart, 2012). To understand whether the objectives were met, the use of the Score Card will be very essential. By use of score Cards, the company will know the content of the strategic plans and whether the plans and the goals are met in time.
The Business Scorecard acts as an evaluation team. Both the managers and the employees will be using the tool for self-evaluation. When the company meets its objectives, the employees shall have achieved the objectives. They may also use the scorecard to understand their strengths and weaknesses within the company. For instance, the Huawei will be able to analyze the strengths and weaknesses in comparison to the competitors. The same tool will be used in improving in those weak areas (Malmi & Granlund, 2009).
Many companies have tried the approach, and it has been very useful to their businesses. They can maximize the profit from their sales and also analyze the taste and preferences of the customers. Through this, the Huawei Company is also able to improve the software and also in the Networking (Malmi, & Granlund, 2009). New strategic plans may also be designed if the initial plans are not met. The company has an option of improvement on the strategic plan if the first fails to be met.
From the above report, some recommendation can be drawn. The Huawei Company should ensure that the tool is implemented fully. Different changes that may occur from the original company’s strategic plans should also be noted. The company must train all the managers and other staffs to ensure that this managerial tool does not meet any resistance during the implementation. Business Score Card is a new tool of management; the company should ensure that its implementation is done step by step to the end. The constant evaluation should be done by the company. In other words, after the full implementation, the managers must always compare the received results from the expectation of the company. This will make the managers understand whether the company grows or is stagnating.
Conclusion
The organizations need to have a link between the performance measurements and the strategy of the companies. The strategic decisions always occur at different levels of the management systems. This must always be with the line of the objectives and goals of the company. The traditional performance measurements system is not suitable to provide the link. Because it only focusses on the short-term objective of the company. There is lack of the dynamic changes concerning the company’s strategic plan with the traditional system.
Due to the number of benefits the new system has over the traditional methods, the company should ensure the Business Score Card is fully implemented to improve on its operation. The Score Card can also help the company to understand the process and flow of its strategic plan. Financial and customers preferences of a company can be evaluated using the Score Card. Managers and staffs evaluation is also achieved by use of the same tool. For this reason, the Business Score Card plays a very significant role in the management of a company. It is also simple to implement compared to other management tools. The system has simple models that both the Time Drive Activity Based Costing (TDABC) and the Activity Based Costing.
References
Brudan, A. (2010). Rediscovering performance management: systems, learning, and integration. Measuring Business Excellence, 14(1), 109-123.
Chen, C. Y., Yang, Y. F., Chen, C. W., Chen, L. T., & Chen, T. H. (2010). Linking the balanced scorecard (BSC) to business management performance: A preliminary concept of fit theory for navigation science and management. International Journal of Physical Sciences, 5(8), 1296-1305.
Chenhall, R. H., & Moers, F. (2015). The role of innovation in the evolution of management accounting and its integration into management control. Accounting, Organizations and Society, 47, 1-13.
Cinquini, L., & Tenucci, A. (2010). Strategic management accounting and business strategy: a loose coupling?. Journal of Accounting & organizational change, 6(2), 228-259.
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Malmi, T., & Granlund, M. (2009). In search of management accounting theory. European Accounting Review, 18(3), 597-620.
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Perkins, M., Grey, A., & Remmers, H. (2014). What do we really mean by “Balanced Scorecard”?. International Journal of Productivity and Performance Management, 63(2), 148-169.
Perkins, M., Grey, A., & Remmers, H. (2014). What do we really mean by “Balanced Scorecard”?. International Journal of Productivity and Performance Management, 63(2), 148-169.
Rassafiani, M., Ziviani, J., Rodger, S., & Dalgleish, L. (2009). Identification of occupational therapy clinical expertise: Decision?making characteristics. Australian Occupational Therapy Journal, 56(3), 156-166.
Shah, H., Malik, A., & Malik, M. S. (2011). Strategic Management Accounting-A Messiah For Management Accounting?. Australian Journal of Business and Management Research, 1(4), 1.
Shah, H., Malik, A., & Malik, M. S. (2011). Strategic Management Accounting-A Messiah For Management Accounting?. Australian Journal of Business and Management Research, 1(4), 1.
Van Seters, J. R., Ossevoort, M. A., Tramper, J., & Goedhart, M. J. (2012). The influence of student characteristics on the use of adaptive e-learning material. Computers & Education, 58(3), 942-952.
Wiersma, E. (2009). For which purposes do managers use Balanced Scorecards?: An empirical study. Management accounting research, 20(4), 239-251.
Yigitbasioglu, O. M., & Velcu, O. (2012). A review of dashboards in performance management: Implications for design and research. International Journal of Accounting Information Systems, 13(1), 41-59.
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