The Balanced Scorecard & the Financial Perspective

The Balanced Scorecard & the Financial Perspective

Introduction

CattCounty ReHab (Cattaraugus County ReHabilitation Center) is a not for profit making organization, the organization did a noble job incorporating a Balanced Score Card (BSC) in the strategic planning process. This is including the customer perspective, financial perspective, learning and growth perspective and in internal process perspective. CattCounty ReHab serves distinct constituencies targeting patients with development disabilities, patients with physical disabilities, injured persons, patients with autism and other patients of different ages suffering from different disabilities; this paper focus at the BSC financial perspective in CattCounty ReHab and its shortcomings, successes and the endeavor.

Analysis

BSC was developed by Harvard Business School through David P. Norton and Robert S. Kaplan. BSC works as a process framework in evaluating the effectiveness of organizations in pursuing the vision and mission of the organization. BSC paradigm focus at four major factors in internal processes, financial position, innovations and customers in defining the performance of the organization (Martello et al., 2008).

CattCounty ReHab as a not for profit making organization did not consider profits as one of the organizational drivers. CattCounty ReHab in this context considered factors that are additional such as, a service to customers and stakeholders, fostering on organizational culture in improving the organization, adapting to the changes, facilitating a clear understanding of internal management and in seeking full support of the stakeholders, employees and the target customers (Kaplan & Norton, 2001). CattCounty ReHab implemented BSC in reviewing the operations of the organization and incorporating the findings in improving the service delivery through long term strategic planning.

CattCounty ReHab is also affected by other factors that influence the general management of the organization. CattCounty ReHab does not focus heavily on profitability and funding as long as the organization has funds to serve the target market. Implementation of the BSC called for participation of all the stakeholders; mainly employees and customers (Martello et al., 2008). Involvement of the players in enforcing the BSC was influential in achieving the vision of the program. In so doing, overall participation encouraged functional units to take part in the focus of the project (Kaplan, 2001). The operations of CattCounty ReHab were scrutinized along the BSC perspectives.

Financial stability of the CattCounty ReHab was evaluated by reviewing the financial management of the organization. The review is part of the strategic plan (Wheelen & Hunger, 2008). The review also reflected on sources of additional income, funding and revenues. The review also reflected on freeing up additional funds that were used by the department managers in carrying out the day to day activities (Martello et al., 2008). The success of BSC in CattCounty ReHab was highly influenced by the empowerment of the stakeholders who were participants in the discretionary funds.

The case study did not touch on long term endowment or giving in gifts or bequests as part of the financial pursuit; the BSC generated customer goals that were diversified. The BSC suggested notification of the general public on available services within the facility; the BSC also recommended increasing some of the team members to carry out public relations as part of the CattCounty ReHab outreach. BSC also suggested constant improvements of the service delivery. CattCounty ReHab implemented an information delivery system that was comprehensive. CattCounty ReHab also studied and measured timeliness of the customer service. CattCounty ReHab reinforced and measured compliance with the existing regulatory environment. CattCounty ReHab also facilitated the safety of the stakeholders. The public relations were implemented with the main aim of generating long term advantages for the future and existing customers (Martello et al., 2008).

CattCounty ReHab also reviewed investments in the technology, workforce and the environment. Investment on human capital focused on employee recognition programs, employee core competencies and other modalities of appreciating the contributions of the human capital in the organization (Martello et al., 2008). CattCounty ReHab also focused on implementation and utilization of technology. The work environment was reviewed for better communication skills and corporate values.

CattCounty ReHab also focused at modernizing morale boosters among the employees, the current system only focused at pay as the main motivation incentive. CattCounty ReHab introduced programs such as the employee of the month recognition among other nonmonetary benefits.

Learning and growth in CattCounty ReHab was attached to the commitment of the organization in serving the target market. Learning and growth within the facility focus at long-term planning of the organization, which is influenced by the commitment of the organization in meeting at the desired objectives (Martello et al., 2008). BSC recommended commitment to change as one of the key drivers of competitive edge. A significant number of the stakeholders were involved monitoring, information gathering and in implementation in realizing the vision of the organization.

Conclusion

BSC in CattCounty ReHab was useful in meeting objectives of the organization; in the sense that the implementation of the BSC went beyond the profit to meeting the exact needs of the stakeholders, customers, entity purpose and employees among others. BSC is influential in not for profit making organizations and has many applications (Martello et al., 2008).

The BSC framework was flexible and had diverse applicability; this set the right performance benchmark for CattCounty ReHab. The adaptation of the BSC in not for profit making organization was excellent in this case study. The staff members of CattCounty ReHab were involved in the BSC process, which made implementation processes easy. All stakeholders felt involved in the management of the facility. The organization became more committed in the service delivery and provided a higher profile in the community served.

 

References

Kaplan, R. (2001). Strategic Performance Measurement and Management in Nonprofit Organizations. Nonprofit Management and Leadership , 353 – 370.

Kaplan, R. & Norton, D. (2001). Transforming the Balanced Scorecard From Performance Measurement to Strategic Management: Part I. Accounting Horizons , 87 – 104.

Martello, M. et al. (2008). Implementing A Balanced Scorecard In A Not-For-Profit Organization. Journal of Business & Economics Research , 67-80.

Wheelen, T. L. & Hunger, J. D. (2008). Concepts in Strategic Management and Business Policy. New Jersey: Prentice Hall.

 

 

 

 

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