The Impact of Balance Score Card Implementation on Supply Chain Firms

The Impact of Balance Score Card Implementation on Supply Chain Firms

Josiah Edmond (University of Technology, Sydney, Australia) and Fawzy Soliman (UTS Business School, University of Technology, Sydney, Australia)
DOI: 10.4018/978-1-4666-6445-6.ch016
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Abstract

The objective of this chapter is to understand the level of impact that implementing a balanced score card can have on organisations, and the factors that contribute to such impact; the research agrees that the BSC is an effective performance measurement system. The result of the research suggests that the quality of the knowledge and the understanding of the BSC within an organisation is a major determinant to the level of positive impact that implementing the BSC can have on an organisation. This research concluded that the same principle applies to any performance measurement and performance improvement initiatives, and that non BSC implemented firms are not necessary worse-off than BSC implemented firms from a performance perspective. Only few numbers of organisations were sampled. These sampled organisations are not a complete representation of the rest. The research acknowledges that the sources of information under which conclusions and assumptions were made were not based on primary sources. It is possible these data may not fully reflect the current state of all sampled organisations in this research.
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Research Methodology And Data Collection

This research is based on archived organisational data from a host of academically written sources. All data collections made were focused on qualitative data. Quantitative data are not the primary focus for this research. It is worth stating that though the concluding view of this study applies inferential statistics, the whole research takes a more descriptive rather than inferential approach. The term supply chain firms were used in a much broader sense to encompass a wider business environment. One of the reasons for doing so is to present a qualitative data analysis of the impact of the BSC implementation on all sampled organisations in the study.

1.1 Research the Current Performance Record of Organisations That Have Implemented The BSC and Identify Post Implementation Impact of the BSC

The need for performance measurement has become a critical part of everyday life, as individuals we continually measure ourselves against a set of criteria. We do this to reconfirm our self concept, identify and maintain our social status and achieve our personal goals. It goes without the saying that performance measurement is also widely used in modern business activities to not just measure past versus current organisational output but even more so, to measure organisational performance against the best in class in the wider global business playground.

Before the idea of a balanced approach to measuring organisational performance was introduced and populated by Kaplan and Norton (Muratoglu, 2008) organisational performance measurement was solely judged by the bottom line. This chapter draws attention that 22 years since the call to a shift from a solely financial based performance measurement indicators to a more robust and balanced measurement, the transition has been less than satisfactory (Mcshane etal, 2010 pp.182). There have also been reports of BSC implementation failures (Rompho, 2011). This chapter believes that analytically comparing organisational performance records of BSC implemented firms prior and after BSC implementation will contribute significantly in understanding the level of impact that the BSC theory has on supply chain firms whether positive or negative

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