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BSC Case Studies

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This book describes 4 examples of using the Balanced Scorecard Framework by two private sector companies and two public organizations.

These case studies are:

1. Case Study 1: Implementation of Strategic Controls with the BSC model for a Bank

2. Case Study 2: Implementation of Strategic Controls with the BSC for a Petrochemical Refinery company

3. Case Study 3: Implementation of Strategic Controls with the BSC for a Public Energy Utility

4. Case Study 4: Implementation of Strategic Controls with the BSC for a Public Sector Organization (Ministry)

Published in: Economy & Finance
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BSC Case Studies

  1. 1. BSC Case Studies John KYRIAZOGLOU, CICA, B.A (Hon.) November 2016
  2. 2. Summary This book describes 4 examples of using the Balanced Scorecard Framework by two private sector companies and two public organizations. These case studies are: 1. Case Study 1: Implementation of Strategic Controls with the BSC model for a Bank 2. Case Study 2: Implementation of Strategic Controls with the BSC for a Petrochemical Refinery company 3. Case Study 3: Implementation of Strategic Controls with the BSC for a Public Energy Utility 4. Case Study 4: Implementation of Strategic Controls with the BSC for a Public Sector Organization (Ministry) For more examples, see: Robert S. Kaplan & David P. Norton: The Strategy–Focused Organization, Harvard Business School Press, 2001.
  3. 3. Case Study 1: Implementation of Strategic Controls with the BSC model for a Bank This case study is based on the Balanced Scorecard Model and it describes the strategic controls for a Banking Corporation, for the four classical BSC perspectives, as defined by Kaplan & Norton: Financial; Customer; Internal Process and Innovation & Learning. FINANCIAL Perspective Strategic Objectives Strategic Controls (Measures) Financial performance Stock Price Cash Flow Profit/Business Function Total Profit/Total Revenue ROI: Return on Investment ROCE: return on capital employed CUSTOMER Perspective Strategic Objectives Strategic Controls (Measures) Increase Customer Satisfaction Customer Retain Ratio Customer Satisfaction Survey
  4. 4. INTERNAL PROCESS Perspective Strategic Objectives Strategic Controls (Measures) Innovative Products/Services Creation Acceptance of new products/services New products/service cycle time Improve Customer understanding Time spent with the Customers INNOVATION & LEARNING Perspective Strategic Objectives Strategic Controls (Measures) Strategic Information Creation Strategic Information Availability Improve Employee Skills Number of specialised seminars Cost of Seminars Strategic Skills Availability
  5. 5. Case Study 2: Implementation of Strategic Controls with the BSC for a Petrochemical Refinery company This case study is based on the Balanced Scorecard Model and it describes the strategic controls for a Petrochemical Refinery Corporation, for the four classical BSC perspectives, as defined by Kaplan & Norton: Financial; Customer; Internal Process; and Innovation & Learning. FINANCIAL PERSPECTIVE Strategy: Financial Development Strategic Objectives Strategic Controls (Measures) Maximize the performance of used capital ROCE: return on capital employed Improve the use of current assets Cash flow Increase profit Net profit CUSTOMER PERSPECTIVE Strategy: Customer satisfaction Strategic Objectives Strategic Controls (Measures) Continuous customer improvement Market share
  6. 6. INTERNAL PROCESS PERSPECTIVE Strategy: Improve operations and quality Strategic Objectives Strategic Controls (Measures) Improve plant operational performance Hours of non-programmed operational disruptions per year Production of goods and services according to schedule and quality specifications Number of orders in error per year Improve plant working conditions Number of accidents per year Improve the management of warehouse materials Materials used per product Cost of not moved warehouse items Cost of not used warehouse items INNOVATION & LEARNING PERSPECTIVE Strategy: Ready and motivated employees Strategic Objectives Strategic Controls (Measures) Improve employee working climate Employee satisfaction survey Improve employee skills Number of seminars Cost of seminars
  7. 7. Case Study 3: Implementation of Strategic Controls with the BSC for a Public Energy Utility This case study is based on the Balanced Scorecard Model and it describes the strategic controls for a Public Energy Provision Utility listed in various Stock Exchanges, for the four classical BSC perspectives, as defined by Kaplan & Norton: Financial; Customer; Innovation & Learning; and Internal Process. FINANCIAL PERSPECTIVE Strategy: Manage costs Strategic Objectives Strategic Controls (Measures) Improve operational performance Total cost of fuels consumed by unit of energy product sold Improve used capital ROI and ROCE CUSTOMER PERSPECTIVE Strategy: Build customer loyalty Strategic Objectives Strategic Controls (Measures) Keeping and increasing customers Number of sales per month Improve reliability Number of disruptions per month
  8. 8. INNOVATION & LEARNING PERSPECTIVE Strategy: Build employee commitment Strategic Objectives Strategic Controls (Measures) Improve security of work Number of accidents per year Improve personnel skills % of employees who have achieved their annual targets Increase personnel commitment Personnel commitment on the basis of surveys undertaken INTERNAL PROCESS PERSPECTIVE Strategy: Build the business Strategic Objectives Strategic Controls (Measures) Maintain investor confidence Net revenue
  9. 9. Case Study 4: Implementation of Strategic Controls with the BSC for a Public Sector Organization (Ministry) This case study is based on the Balanced Scorecard Model and it describes the strategic controls for a Public Organization (e.g., Ministry), for the four public sector BSC perspectives, as defined by Kaplan & Norton: Results, Customer, Internal Process, and Personnel Development. RESULTS PERSPECTIVE Strategy: Effective support of Government Policy Strategic Objectives Strategic Controls (Measures) Improve support of Government Policy Acceptance of recommendations made Number of recommendations per year Response time Reduce operational cost % cost reduction per year CUSTOMER PERSPECTIVE Strategy: High quality services to citizens and enterprises Strategic Objectives Strategic Controls (Measures) Improve service Response time, errors, complaints, etc. Number of procedures improved
  10. 10. INTERNAL PROCESS PERSPECTIVE Strategy: Improved procedures and systems Strategic Objectives Strategic Controls (Measures) Improve systems development Implementations on time and budget Systems accepted and put to operation Number of quality errors Improve systems operation Operational errors Improve communication with ‘customers’ Number of press announcements Number of WEB interactions Number of customer meetings held Number of customer feedback surveys PERSONNEL DEVELOPMENT PERSPECTIVE Strategy: Effective improvement of working conditions Strategic Objectives Strategic Controls (Measures) Objective personnel evaluation Personnel complaints resolved Effective personnel training Training hours, seminars, cost % personnel satisfied with the training taken
  11. 11. DISCLAIMER Any mention or reference of organizational entities, commercial products, standard methodologies, standards, handbooks, guides, guidelines, policies, forms, procedures, documents, processes, models, software, tools, plans, measures, techniques, ideas, declarative statements, etc., (collectively termed ‘objects’), within this book, is solely done for information and educational purposes. This mention or reference does not imply any recommendation or endorsement by the authors and publishers of this book that these ‘objects’ are best suited or even at all relevant for the purposes of any organization (public, private, etc.). All such organizations should independently evaluate and assess these ‘objects’ before determining whether to customize and use these ‘objects’ in their unique corporate operating environment and socio-economic context.

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