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Kaplan and Norton developed the balance scorecard in the early 1990s as a tool for management to view the organizations from many different perspectives and
Kaplan and Norton developed the balance scorecard in the early 1990s as a tool for management to view the organizations from many different perspectives and it is still a tool that is utilized by all companies (Pierce, E 2022). The four components of the balanced scorecard, financial (stewardship), customer (stakeholder), internal process, and organizational capacity (learning and growth), can be used by a publicly traded company. Financial stewardship can help companies assess their profitability, liquidity, and overall financial health. It can be used to track revenue growth, profit margins, return on investments, cash flow, and debt to equity ratios (Pierce, E 2022). For customer (stakeholders), the customer satisfaction can be measured to determine the satisfaction scores by using tools like the Net Promoter Score (NPS). By using this they can get a read on how well they meet customers expectations, and they can identify areas for improvement. By monitoring the market share, the publicly traded company can assess its ability to attract and keep its customer base by analyzing market trends. For internal process, the company can use metrics such as the cycle time, and the on-time deliveries, to make sure that the performance is efficient. By doing this the company can make sure that they are improving on the process and increasing productivity. Another tool for the internal process is monitoring the quality management to make sure there are no high defect rates. By doing these checks the company can make sure they are delivering a high quality product (Pierce, E 2022). For Organizational Capacity (learning and growth), the company can focus on improving its employees skills, and create a learning culture within the company. By promoting employee engagement the company can then measure the employee satisfaction and turnover rate to make sure that their efforts are motivated the employees within the company. By using the balanced scorecard publicly traded companies can monitor and manage their financial performances, customer satisfaction, internal processes, and organizational capacity
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