The current research is based on appropriateness of non-financial metrics in examining firm performance. Therefore, the paper focuses on critical analysis of BSC as a performance measurement tool. That is, the researcher intends to answer the following primary research question: To what extent does the balance scorecard (BSC) approach influence both performance appraisal and strategic management?
Specifically, the paper reviews what BSC is and how it is applied in various firms. The paper also attempts to link performance appraisal and strategic management. In doing so, it answers the following study sub questions:
How effective is the application of the balance scorecard?
What importance does performance appraisal have to the growth of a firm?
What are the consequences of not implementing non-financial measures within an organisation?
To answer the questions, the researcher conducts a critical literature review of past studies and theories on performance management, strategic management and BSC. The goal of the review is to explain the impact of BSC as a firm performance management tool on the strategic success of the firm. The rest of the paper is, therefore, organized in two sections i.e. literature review and conclusion and recommendations. Literature review section presents a critical evaluation of past studies and theories on BSC and performance management and appraisal. The conclusion and recommendations section summarises the findings and make suggestions for practice and future studies.
Inhaltsverzeichnis (Table of Contents)
- Rationale
- Research questions
- Literature review
- Balanced scorecard is basically defined as a performance management report
- Effectiveness of application of the balance scorecard
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper aims to critically evaluate the use, application, benefits and necessity of non-financial measures in the context of the Balanced Scorecard (BSC) approach. It further seeks to provide recommendations for alternative performance measurements and inspire future research on the effectiveness of BSC.
- The impact of the Balanced Scorecard approach on performance appraisal and strategic management.
- The effectiveness of applying the Balanced Scorecard in organizations.
- The significance of performance appraisal in driving firm growth.
- The consequences of not integrating non-financial measures within organizations.
- The role of the Balanced Scorecard in strategic success.
Zusammenfassung der Kapitel (Chapter Summaries)
- Rationale: This section introduces the concept of strategic management and its importance in maximizing firm resources in line with objectives and the demands of the business environment. It also explains the origins of the Balanced Scorecard (BSC) and its role in addressing the inadequacies of traditional financial-based performance measurement tools.
- Research questions: This section outlines the primary research question and sub-questions that the paper aims to address. The primary research question focuses on the extent to which the BSC influences both performance appraisal and strategic management. The sub-questions delve into the effectiveness of applying the BSC, the importance of performance appraisal for firm growth, and the consequences of not incorporating non-financial measures within organizations.
- Literature review: This section provides a comprehensive overview of the BSC, highlighting its definition, key features, and application in various firms. It discusses how the BSC measures performance from both financial and non-financial perspectives and its ability to translate organizational mission, objectives, and strategies into actionable measurements.
- Effectiveness of application of the balance scorecard: This section focuses on the original purpose of the BSC, which is performance measurement. It delves into the four key performance metrics identified by Kaplan and Norton – financial, customer, internal process, and learning and growth – and how measuring these metrics enables firms to track critical aspects of their strategy and achieve continuous improvement.
Schlüsselwörter (Keywords)
The key concepts explored in this paper include the Balanced Scorecard (BSC), performance appraisal, strategic management, financial and non-financial performance measures, organizational goals, and the impact of the BSC on firm performance and success.
- Quote paper
- Anonym (Author), 2019, To what extent does the balance scorecard approach influence both performance appraisal and strategic management?, Munich, GRIN Verlag, https://www.grin.com/document/961647
