Paper Requirements
public sector organizations and effect of balance scorecard on the manage performance:
Introduction.
Public sector organizations in UAE.
Relationship between of balance scorecard on the manage performance in private and in public sector
Balance
Scorecard
Introduction
Balanced
Scorecard (BSC) has been used as a management tool to provide senior executives
with a periodic assessment and control of individual and departmental work toward
the achievements of organizational strategies (Hannabarger,
Buchman & Economy, 2007). The founding fathers of this crucial tool
are Dr. David Norton and Dr. Robert Kaplan. This key tool has come to assist
management with a concise overview of the general organizational progress
toward a realization of the preset goals and objectives (Hannabarger,
Buchman & Economy, 2007).
Ideal
BSC is subdivided into sections where each plays a part in accomplishing the
general success of a company (Alexander & Sinnett,
2005). These sections include company’s financials, learning and growth,
customer perspectives and internal processes. Scorecard captures enough details
that can enhance organizational performance in order to realize a strategy.
This requires given sub-sections to have an outline of 6-9 measures aimed at improving
performance (Alexander & Sinnett, 2005).
Purpose
This
paper aims to examine the use of BSC as a performance measurement and
management tool in the United Arab Emirates (UAE) (Alexander
& Sinnett, 2005). It identifies the relationship that exists between
the use of BSC in both public and private sectors and the measurement of a
progress and realization of firm’s strategies.
Design
and approach
The
approach that was utilized in this research included the following methods:
1.
Questionnaire: this included printed
questions that were distributed among the key individuals in both private and
public sectors to inquire their views. Afterwards, questionnaires were
collected, analyzed and a conclusion was drawn (Byrd &
Megginson, 2013).
2.
Interviews: this approach is
time-consuming and tedious because it involves having a face-to-face interview
with an individual. Therefore, only a few members from each firm were
interviewed. The main reason why interviews are exhausting is the need for the follow-up
interviews to clarify the results. However, this method is the most reliable
and accurate (Byrd & Megginson, 2013).
Findings
Both
the interviews and the questionnaires that were used in data collection produced
the following findings:
1.
The use of BSC as a management tool in
local governments and public institutions in UAE: the study revealed that the
use of BSC and public awareness at the UAE local government institutions are quite
high (Malone, 2004). The study also showed a disparity
between the awareness and the use of BSC at the city and district councils. Generally,
the study reveals that most of the public institutions have adopted and used
BSC as their management tool (Malone, 2004). The table
below presents a breakdown of the figures captured by given research.
2.
Factors that ensure successful
implementation of the BSC: respondents from both sectors reported the two key
factors that ensured efficient use of BSC and its achievement of a designated
function in the organization. These factors include understanding of the BSC
and its customization to fit in with the culture and work ethics of the firm analyzed.
3.
Manager’s perception of BSC as a
management tool: the study showed that out of the 48 local government and
public institutions surveyed less than a half of respondents either previously
or currently uses the BSC to track the general progress of the company and
check individual’s performance (Malone, 2004).
With the rating scales of BSC ranging from 1-5 (5 meaning that the BSC is
useful and 1 - useless), the responses of the interviewed individuals varied
significantly. Responses collected from the private institutions were almost
the same with the average BSC value of 3-4, which implied that the BSC is quite
useful in realizing the strategies set by an organization. The table below presents
a summary of responses from the public sector.
Most
of the responses from the open-ended interviews include the following:
A. BSC
is a tool used to provide a clear focus and direction in terms of
accountability hence used as a tool in measuring the achievement of certain set
goals (public institutions) (Malone, 2004).
B. BSC
makes the job of senior management easier since it provides a set of concise information
that can be used to measure organizational performance and track the general
progress of the company. It creates a benchmark for the generation of progress
reports to reflect the success achieved by an organization (private companies) (Malone, 2004).
Barriers toward the successful implementation
of BSC: 81.3% percent of the respondents from the local and public institutions
revealed that they have never used BSC before. The table below illustrates the
distribution of responses. 
Due
to such results, it is paramount to understand the underlying reasons that have
challenged the implementation of BSC. Most of the respondents from the public
and private sectors highlighted the following as the main reasons:
1. The
use of alternative systems in place of BSC: most of the respondents indicated
that their companies have already developed their customized BSC tools, which
they use to track the general progress of an organization toward the
realization of its strategies (Lawrie, 2004).
2. The
varied size of an organization: some of the respondents highlighted that since their
organizations are small and young it could be one of the reasons as to why they
did not implement BSC (Lawrie, 2004).
3. The
challenge of resource allocation: respondents argued that for a BSC to be
successfully implemented it had to rely on other sub-systems in capturing the
right information and data. This meant that BSC was bound to fail if the right
systems were not in place to support organizational objectives through the
collection of the required data (Daft & Marcic,
2014).
4. Busy
managers: most of the respondents also mentioned that the top management is
always busy and thus, cannot find time to push through the role of BSC in their
firms (Malone, 2004).
5. Lack
of support from the top management: in essence, BSC is a tool that is supposed
to be used by the management to track the progress of the firm in terms of the
realization of the outlined strategies. If top management fails to provide enough
support to implement a BSC, it means that BSC will be useless for an
organization (Meyer, 2002).
It
is noteworthy to mention that the above responses came in an equal measure from
both private and public sectors. A difference in the number of respondents was
quite negligible with 67.75% from the public sector and 68.01% from the private
sector respectively. This means that same challenges in both sectors prevent the
BSC from realizing its full potential.
General
insights into the topic
The
research showed that integration of a BSC in both sectors (private and public)
has a huge gap in between. From a sample of 40 private and 40 public institutions,
the responses were as follows:
|
firm
|
Sampled
number
|
respondents
|
+ve of
BSC
|
-ve of BSC
|
|
Private
firm
|
40
|
35
|
26=
74.28%
|
9=25.71%
|
|
Public
firm
|
40
|
33
|
20=60.61%
|
13=39.39%
|
Based
on the table above some of the key conclusions can be drawn:
1. Integration
of BSC is high in a private sector where it is ranked at 74.28% compared to 60.61%
in the public sector accordingly.
2. Advantages
of BSC in any firm exceed its disadvantages. In private companies, its positive
influence is rated at 74% against 25% (negative), while the public sector ranks
it at 60% and 39% for positive and negative influence respectively.
3. The
number of respondents viewing BSC negativity is higher in the public sector with
a figure of 39.39% as compared to 25.71% in the private sector.
Conclusion
Based
on a given research and its insights, it is important to note that the key benefit
of using BSC is its ability to track the progress of an organization in
realizing its objectives (Daft & Marcic, 2014).
Moreover, it makes the work of the top management easier because the tool can
generate reports that can be analyzed within the minimum time possible. BSC helps
every employee align his/her performance and behavior with company’s vison and
strategies. Therefore, one of the recommendations for the firms is to adopt and
exploit the tool on a daily basis since its advantages significantly outweigh its
disadvantages. The role of BSC in improving and tracking the progress of a company
in realizing its strategies cannot be underestimated (Sommerville,
2007). Success of the tool greatly depends on support from the top
management. Hence, support from the managers is a must rather than a choice in
order for an organization to enjoy the benefits of BSC.
References
Alexander, G., & Sinnett, W. (2005). Business
performance management. Florham Park, NJ: Financial Executives Research
Foundation.
Byrd, M., & Megginson, L. (2013). Small
business management. New York, NY: McGraw-Hill.
Daft, R., & Marcic, D. (2014). Building
management skills. Mason, Ohio: South-Western Cengage Learning.
Dooren, W., Bouckaert, G., & Halligan, J. (2010). Performance
management in the public sector. New York, NY: Routledge.
Hannabarger, C., Buchman, R., & Economy, P.
(2007). Balanced scorecard strategy for dummies. Hoboken, NJ: Wiley.
Lawrie, G. (2004). Strategic performance management.
Bradford, UK: Emerald Group Pub.
Malone, O. (2004). 101 leadership actions for
performance management. Amherst, MA: HRD Press.
Meyer, M. (2002). Rethinking performance
measurement. Cambridge, UK: Cambridge University Press.
Sommerville, K. (2007). Hospitality employee
management and supervision. Hoboken, NJ: John Wiley.
Walker, S. (2012). Employee engagement and
communication research. London, UK: Kogan Page.
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