The Impact of Balanced Scorecard on Performance Planning in BHEL
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The Impact of Balanced Scorecard on Performance Planning in BHEL

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This presentation will give you an idea about the balanced scorecard and performance planning in Bhel.

This presentation will give you an idea about the balanced scorecard and performance planning in Bhel.

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The Impact of Balanced Scorecard on Performance Planning in BHEL The Impact of Balanced Scorecard on Performance Planning in BHEL Presentation Transcript

  • THE IMPACT OF BALANCED SCORECARD ON PERFORMANCE PLANNING IN BHEL Presented By Soumya M.R Roll No: PGDM 10-021 DCSMAT Trivandrum07/04/2011 1
  • OVERVIEW• About the company: BHEL , leading public sector company (Navaratna), largest engineering and manufacturing enterprise in India.• It is the 12th largest power equipment manufacturer in the world.• 14 units in different parts of the country.• Hyderabad unit one of main unit of BHEL with 8454Cr turn over.• The main products are Turbo-generator sets and auxiliaries for 60 and 110 MW thermal utility sets07/04/2011 2
  • VISION• VISION• A World-class Engineering Enterprise Committed to enhancing Stakeholder Value.• MISSION• To be an Indian Multinational Engineering Enterprise providing Total Business Solutions through Quality Products, Systems and Services in the fields of Energy, Industry, Transportation, Infrastructure and other potential areas.07/04/2011 3
  • BALANCED SCORECARD• originated by Robert Kaplan and David Norton in 1992.• It is a framework that translates vision and strategy into performance measures.• Creates a balance between all perspective both financial and non- financial.• There is a linkage between all the parameters in a balanced scorecard• There are lag and lead indicators in the Balanced Scorecard07/04/2011 4
  • BALANCED SCORECARD ANSWER’S• How should we appear to our customers? (Customer perspective),• What should we excel at? (Internal business perspective),• How should we sustain our ability to change and improve? (Learning and growth or Innovation and learning perspective)• How should we appear to our shareholders? (Financial perspective).07/04/2011 5
  • CLARIFYING AND TRANSLATING VISON AND STRATEGY COMMUNICATING AND STRATEGIC FEEDBACK LINKING AND LEARNING PLANNING AND TARGET SETTING07/04/2011 6
  • BALANCED SCORECARD• Financial perspective: Consists of KPIs like Turn over, Return on capital employed.• Customer perspective: Direct orders booked by the unit, Delivery index of on time .• Internal processes perspective: Material consumption, completion of engineering• Learning and growth perspective: R ‘n’ D expenditure, Commercialization of in-house developed products07/04/2011 7
  • BALANCED SCORECARD07/04/2011 8
  • BALANCED SCORECARD IN BHEL • BSC is a part of E-MAP(PERFORMANCE MANAGEMNET SYSTEM) started 2002-2003. • The system covers Frontline Executives(E1-E4) and Middle level Executives of BHEL(E5-E7). • BSC is cascaded to various levels, ensuring proper alignment between the objectives targets flowing from top to bottom. • 212 BSC holders are there.07/04/2011 9
  • CASCADING OF BALANCED SCORECARDMEMORANDUM OF UNDERSTANDING WITH MINISTRY OF HEAVY INDUSTRY GOVERNMENT OF INDIA CORPORATE BSC UNIT BSC DIVISION PRODUCT BSC HOD BSC07/04/2011 10
  • PERFORMANCE PLANNING• Performance planning is initiated in the month of March upon the finalization of budget.• Identify appropriate KRAs from functional KRA Master• If required, request for new KRAs and seek approval from HOD• Set five levels of targets for each KRA• Propose an action plan for achievement of each KRA Target• Assign a weightage for each KRA• Resolve any conflicts between Appraisee and Appraiser07/04/2011 11
  • OBJECTIVES• To know the awareness of employees about the BSC model• To study the linkage of BSC to performance management system• To study the various steps involved in framing the BSC• To study interdepartmental dependencies• To study the role of BSC in achieving performance targets.07/04/2011 12
  • ANALYSIS• Awareness: Good ,makes target setting easier.• The linkage of BSC to performance management : good• BSC helps to monitor and manage business.• The unit level BSC is a prerequisite for framing the division BSC.• Cascading BSC throughout the firm means there are consistent in the application of BSC.• Executive involvement is less for the development of divisional BSC.07/04/2011 13
  • ANALYSIS •Communication increases the cascading of BSC more effective in the firm. •Responsibility identification empowers employees which improves organizational performance. •Review of BSC needs to be done. Half yearly. •Success of BSC depends on organizational culture .BHEL shares a common culture. •Success of the balanced scorecard depends on a successful team.07/04/2011 14
  • SUGGESTIONS• Assigning responsibility to the individuals.• Action points and needs to be reviewed• Cascading of level-leads to actionable KPIs.• Feedback mechanism• Encourage employee participation.07/04/2011 15
  • CONCLUSION• Balanced scorecard• Analysis07/04/2011 16
  • THANK YOU07/04/2011 17