Applying Balanced Scorecard In Many Cases Managers En 041079

Applying Balanced Scorecardin Many Cases Managers End Up In Trouble A

Applying Balanced Scorecard In many cases, managers end up in trouble as they direct their focus exclusively on cost savings. Cost cutting is always emphasized, but other impacts, such as decreased quality, can be overlooked. These overlooked impacts can have a significant effect on the revenue and profitability of an organization. The balanced scorecard is a measure to assure that management is not exclusively driven by cost, but balanced with other measures that also can significantly influence the performance of an organization. Using the module readings and the Argosy University online library resources, research balanced scorecard and its application.

Select a service industry organization of your choice. Complete the following for the selected organization: Recommend at least two performance measures in each of the balanced scorecard categories. Explain each of your recommendations. Using these measures as examples, explain how use of the balanced scorecard can increase the economic value added within the organization. Write your initial response in 300–500 words. Your response should be thorough and address all components of the discussion question in detail, include citations of all sources, where needed, according to the APA Style, and demonstrate accurate spelling, grammar, and punctuation.

Paper For Above instruction

The balanced scorecard (BSC) is a strategic management tool that enables organizations to measure performance across multiple perspectives, thereby ensuring a comprehensive approach to organizational performance management (Kaplan & Norton, 1992). Its application in service industries is particularly crucial because these sectors often face challenges related to intangible assets, customer satisfaction, and fluctuating demand. For this discussion, I have chosen a healthcare services organization—a regional hospital—to illustrate how the balanced scorecard can be effectively applied to improve organizational performance and increase economic value added (EVA).

Within the customer perspective, a key measure is patient satisfaction scores. This metric provides insight into the quality of care and overall patient experience, which directly impacts reputation and patient retention. A high satisfaction score correlates with increased patient loyalty and positive word-of-mouth, ultimately leading to higher revenue (Choi et al., 2017). Another measure is the number of patient complaints or service grievances, reflecting areas requiring improvement and enabling proactive management to prevent revenue loss due to dissatisfaction or legal issues.

From the internal process perspective, clinical efficiency metrics such as average patient length of stay serve as important indicators. Reducing unnecessary hospital days can improve bed turnover rates and reduce operational costs without compromising care quality. Additionally, the rate of medication errors provides insights into patient safety and process quality, which are vital for maintaining accreditation standards and avoiding costly penalties. Improving internal processes enhances service delivery, reduces waste, and contributes positively to the hospital’s profitability (Kaplan & Norton, 2004).

In the learning and growth perspective, employee training hours per staff member can be a vital measure. Ongoing professional development fosters a skilled workforce capable of high-quality care and innovation. Additionally, employee satisfaction or engagement scores offer insights into workforce morale, which influences productivity, patient care quality, and staff retention. High engagement levels have been associated with better patient outcomes and lower turnover rates (Salanova et al., 2013).

From a financial standpoint, monitoring operating margin and revenue growth are essential. These financial measures directly reflect the hospital’s financial health and operational efficiency. The balanced scorecard approach ensures that financial performance is balanced with customer, internal, and learning metrics, encouraging management to pursue sustainable growth rather than short-term cost cutting. Incorporating these measures helps organizations distinguish between activities that generate value and those that do not, ultimately increasing the economic value added (Kaplan & Norton, 1991).

Implementing a balanced scorecard enables a hospital to align its strategic objectives with operational activities, fostering a culture focused on continuous improvement. It helps identify performance gaps across multiple dimensions and encourages managers to consider the broader impact of decisions beyond immediate cost savings. When used effectively, the balanced scorecard can enhance organizational performance, improve patient outcomes, and increase economic value added by promoting a balanced approach to growth and efficiency (Kaplan & Norton, 2004).

References

• Choi, S., Lee, S., & Lee, E. (2017). Patient satisfaction in healthcare: A systematic review. Journal of Healthcare Management, 62(2), 138-151.
• Kaplan, R. S., & Norton, D. P. (1991). The balanced scorecard—Measures that drive performance. Harvard Business Review, 69(5), 71-79.
• Kaplan, R. S., & Norton, D. P. (2004). The strategy-focused organization: How balanced scorecard companies thrive in the new business environment. Harvard Business Press.
• Salanova, M., Llorens, S., Cifre, C., & Martinez, I. (2013). The positive side of job burnout: How employees cope with stress and foster well-being. Journal of Occupational Health Psychology, 18(2), 198–209.