Nowadays, many companies should not only discuss about how to obtain profits from their products, which are successfully sold to their customers, but also they should be forced to use any other aspects that are able to give more impact for their long-term success. For examples, discussing about quality of their products, relationship between them and their customers and employees, and the production process as well as marketing. Those are the challenges for all managers who are not only struggling in achieving company’s targets - high profits but also in achieving customer, employees and stakeholders satisfaction. Schermerhorn (2011, p. 16) generally sees the role of managers in a company and stated that all managers, regardless of their titles, levels, types, and organisational settings, are responsible for the four primary management functions which are defined by Lewis, et al. (2007) as planning, organising, leading, and controlling.
a) Planning should be described that managers have tasks in setting targets and in defining actions that are necessary to achieve the targets of their companies.
b) Organizing involves determining the assignments to be done and how those assignments would be managed and coordinated to reach the company's targets.
c) Leading should be defined that managers should be able to guide, to motivate, and to lead the employees in order to effectively and efficiently achieve company’s targets.
d) Controlling requires the managers to monitor process of planning, leading and organising whether its process may be able to help reaching the targets, targets have been achieved as expected and applied strategies have been effective or not.
It is difficult for managers to accept the challenges. Therefore, managers need to seek out an approach which is able to help them finishing their tasks and involves not only one aspect but any other aspects, such as customers, shareholders, internal business processes and employees. For other aspects, Tesarovicova (2008) clarified that a higher return on the funds and an increase of the company value is expected by shareholders and owners since customers expect a higher value and quality of products. Nevertheless, the problem appears where to reconcile conflicting demands of individual interest groups are not easy. [...]
Table of Contents
Chapter 1 Introduction
1.1. Problem Description
1.2. Objectives
1.3. Structure
Chapter 2 BSC as A Strategic Controlling Instrument
2.1. Traditional Performance Measurement Concepts as Predecessor of BSC
2.2. Comparing BSC with Traditional Performance Measurement
2.3. Controlling Instruments
2.3.1. Operational Instruments
2.3.2. Strategic instruments
2.4. Balanced Scorecard (BSC)
2.4.1. Implementation of BSC
2.4.2. Targets and tasks of BSC
2.5. The four-perspectives of BSC
2.5.1. Financial
2.5.2. Customer
2.5.3. Internal business process
2.5.4. Learning and growth
2.6. Strategic targets formulated in the four perspectives
2.7. The concept of indicators system
2.7.1. Monetary indicators
2.7.2. Non-monetary indicators
Chapter 3 Implementation of BSC in automobile industries
3.1. BSC at Daimler AG
3.2. BSC at BMW Group
Chapter 4 Analysis of using BSC
4.1. Cause-and-effect correlations
4.2. Advantages and Disadvantages of BSC
4.3. Chances and challenges of implementing BSC
Chapter 5 Conclusion
Objectives & Research Themes
This thesis examines the benefits of introducing the indicators-based Balanced Scorecard (BSC) as a strategic controlling instrument for corporate strategy, specifically analyzing how it integrates multiple perspectives to enhance long-term company performance. The primary research goal is to evaluate if the BSC framework effectively addresses management challenges, enables strategy implementation, and contributes to verifiable financial success.
- Strategic alignment of corporate goals via the four BSC perspectives.
- Transformation of corporate strategy into measurable indicators.
- Comparative analysis of BSC implementation in German automobile companies (Daimler AG and BMW Group).
- Evaluation of cause-and-effect relationships within the BSC framework.
- Assessment of the advantages and challenges associated with implementing the Balanced Scorecard.
Excerpt from the Book
2.4.1. Implementation of BSC
According to Savkin (2011, p. 20), the company works usually with the strategy which is made by CEO or top-management. CEO makes a specific business strategy and then determines the particular targets to the lower level employees. The lower level managers convert the global strategic targets into specific business works that are necessary to be finished in order to achieve the strategic goal. In the end, these specific works are explained to the low level employee to be executed. In this part, the concept of BSC may be used as systematic approach which may translate the global target to the end-level employee. As a result, the idea of CEO may be easily understood on each level. From this point of view, it may be argued that BSC has an ability to explain the strategy to employees on each level and it is possible to be used to explain the strategy due to his opinion that BSC contains some indicators which would be connected to the company's main goals.
Furthermore, Weber and Schäffer (2008, p. 149) stated that the concept of balanced scorecard may be applied as a measurement system and then it may be used as a tool to connect company’s strategy with its operations. In other words, when a manager has had a strategy for the company then the manager may insert BSC into its strategy in order to help a manager implement its strategy or take action. They also argued that this concept is reliable to connect between strategies with its operations.
Summary of Chapters
Chapter 1 Introduction: Defines the core management challenges and the necessity for modern controlling tools, establishing the Balanced Scorecard as a focal topic.
Chapter 2 BSC as A Strategic Controlling Instrument: Outlines the theoretical foundations of the BSC, its four perspectives, and the accompanying indicators system as a strategic management framework.
Chapter 3 Implementation of BSC in automobile industries: Provides practical case studies of Daimler AG and BMW Group, analyzing their adoption of the BSC to drive strategic success.
Chapter 4 Analysis of using BSC: Evaluates the effectiveness of the BSC through cause-and-effect correlations and investigates its organizational advantages and implementation challenges.
Chapter 5 Conclusion: Summarizes the findings, affirming that the BSC provides significant benefits for strategic alignment, though its successful deployment requires substantial resources and management commitment.
Keywords
Balanced Scorecard, Strategic Controlling, Performance Measurement, Financial Perspectives, Customer Satisfaction, Internal Business Processes, Learning and Growth, Indicators, Corporate Strategy, Daimler AG, BMW Group, Management, Strategy Implementation, Cause-and-Effect Correlations, Quantitative Indicators.
Frequently Asked Questions
What is the primary focus of this research?
This thesis explores the application of the Balanced Scorecard (BSC) as a strategic controlling instrument, specifically focusing on how it helps companies translate corporate strategy into actionable goals across four distinct perspectives.
What are the four perspectives of the Balanced Scorecard discussed?
The four perspectives are Financial, Customer, Internal Business Process, and Learning and Growth.
What is the central research question?
The research seeks to determine whether the BSC framework effectively aids managers in overcoming corporate challenges, improving strategic performance, and achieving long-term goals.
Which methodology is employed in this thesis?
The work utilizes a combination of theoretical research into strategic controlling instruments and a qualitative comparative case study analysis of two major German automotive firms.
What does the main body of the text cover?
The main body examines the theoretical background of the BSC, the practical implementation in the automotive industry, and a critical analysis of the advantages, disadvantages, and the cause-and-effect relationships inherent in the model.
How is the success of the BSC defined in the text?
Success is defined by the framework's ability to create transparency, link operational tasks to top-level strategy, and ultimately lead to improvements in performance metrics like revenue and EBIT.
How does the Balanced Scorecard differ from traditional financial performance measurement?
Traditional measures focus primarily on past financial events, whereas the BSC is multidimensional and future-oriented, incorporating both monetary and non-monetary indicators.
Are there specific requirements for successfully implementing the BSC?
Yes, the author highlights that successful implementation requires strong support from top management, a clear communication strategy, substantial investment in resources, and a high degree of organizational transparency.
- Citar trabajo
- Christoper Dewangga Pramudita (Autor), 2015, Benefits of Introducing the Indicators-based Balanced Scorecard as Strategic Controlling Instrument for Implementation of Corporate Strategy from Four Different Perspectives, Múnich, GRIN Verlag, https://www.grin.com/document/318161
