Introduction
The Balanced Scorecard (BSC) is an important tool that is used to provide leaders with certain performance metrics arranged according to four perspectives or areas: financial, customer, internal processes, and learning and growth ones (Mackay, 2005). In spite of the fact that the BSC is viewed as most appropriate to be applied in profit organizations, this technique can also be used by non-profit organizations because of its advantages for strategic planning (Pramudita, 2016).
Cattaraugus County ReHabilitation Center is one of the non-profit organizations oriented to addressing the needs of children with disabilities. The Center was established in 1958, and now it offers services to persons with disabilities in order to provide assistance and improve the quality of their life (Martello, Watson, & Fischer, 2008). While analyzing the organization’s activities from the perspective of the BSC, it is possible to state that the Cattaraugus County ReHabilitation Center effectively implemented the BSC approach in a manner that reflects its organizational mission and vision.
Analysis
The ReHabilitation Center succeeded in implementing the BSC while making sure that all four perspectives align with the organization’s mission, which is in improving the quality of life of individuals with disabilities, and its vision, which is in becoming a community leader in providing appropriate services for persons with disabilities (Martello et al., 2008). In non-profit organizations, the realization of activities according to the BSC financial perspective means maximizing funding and maintaining the financial stability to guarantee that there are enough resources to support the proposed services. As a result, financial prosperity is not a goal for non-profit organizations, but it is a measure to serve more clients (Niven, 2014; Pramudita, 2016).
While stating that the ReHabilitation Center effectively implemented the BSC approach, it is possible to refer to the organization’s use of the financial perspective (Martello et al., 2008). The Center focused on increasing revenues by searching for new sources and maximizing funding. The additional focus was on improving productivity (Martello et al., 2008). The associated goals were determined along with appropriate measures and approaches to finding new funds and resources.
The focus on the customer perspective was extremely important for the Center. The organization succeeded in determining goals according to clients’ needs: to improve the quality of life and increase the satisfaction of customers. The Center successfully identified its clients according to the mission and vision and determined their needs and values to set measures. It was important to propose goals oriented to addressing the gap in services and maximizing clients’ independence in using these services (Martello et al., 2008).
As a result, the Center became oriented to providing clients with more working opportunities, more access to services, more individualized services, and more support. The percentage of individuals who received these services was selected as a key indicator of success in realizing the set goals (Martello et al., 2008).
The internal process perspective was also used by Cattaraugus County ReHabilitation Center in order to align the organization’s strategy with its mission and vision. The improvement of internal processes according to financial goals to achieve the customer-oriented objectives was an important step (Mackay, 2005; Niven, 2014). The Center formulated the following goals in the context of the internal process perspective: achieve excellence in operations, create secure environments, and create systems for delivering services effectively (Martello et al., 2008).
Specific measures to assess outcomes and improvements in services were determined. These goals were realized successfully because they were formulated to support client-oriented services and objectives developed for the customer perspective (Murby & Gould, 2005). As a result, it became possible to improve access to services and develop relationships with clients with disabilities. Furthermore, these goals were directly associated with improving productivity.
The fourth perspective determined in the context of the BSC approach is the learning and growth one. This perspective can be discussed as a basic one for realizing any strategy. It is grounded in identifying employees’ resources and technologies to implement the goals associated with other perspectives in the context of the strategy developed for the Center. In order to guarantee that the organization’s mission, vision, and strategic goals are realized, it is important to develop such resources as workforce, techniques, advanced technologies, and effective practices (Asefeso, 2013; Mackay, 2005).
These resources are significant to realize objectives connected with the internal process perspective. The ReHabilitation Center succeeded in combining strategic goals for these perspectives in the context of the BSC in order to provide access to services, address expectations of employees, and satisfy the needs of customers (Martello et al., 2008). Thus, the organization focused on improving the staff’s skills, providing working opportunities for employees, and retaining them to increase their professional potential. All these techniques were effective in improving not only the operations of the Center but also its organizational culture.
Still, it is also important to pay attention to the fact that while implementing the BSC approach, the Center also faced certain challenges. There were problems with determining objectives and measures for areas that are more typical of profit organizations (Asefeso, 2013; Mackay, 2005; Pramudita, 2016).
However, in spite of the fact that the realization of the BSC approach was questionable, the managers of the organization succeeded in developing goals that were directly associated with the organization’s strategy and the BSC concept (Martello et al., 2008). As a result, a range of benefits was opened to the Center. Realistic objectives and measures were set for the organization to achieve its strategic goals and address the customer’s needs. The possibility to determine effective metrics was important for the successful realization of objectives.
Conclusion
After analyzing the results achieved by the Cattaraugus County ReHabilitation Center regarding the realization of the BSC approach, it is possible to state that the organization effectively integrated this concept into its strategy while achieving significant positive results. Thus, the key objectives for the financial perspective were formulated with reference to the customer perspective because the orientation to clients is a priority for non-profit organizations.
Furthermore, the determination of objectives according to the financial and customer perspectives allowed for addressing the organization’s mission and vision. In addition, the goals identified with reference to the internal process and learning and growth perspectives were based on objectives formulated for the financial and customer areas. From this point, the implementation of the BSC approach allowed for developing the most effective strategic goals and arranging them according to four perspectives of the BSC concept in order to demonstrate their alignment and correlation with the organization’s mission and vision.
Finally, it is important to state that the Center effectively used the BSC approach because the organization focused on both financial and customer perspectives according to the needs of a non-profit company.
References
Asefeso, A. (2013). Balanced scorecard. Swindon, UK: AA Global Sourcing Ltd.
Mackay, A. (2005). Research report: A practitioner’s guide to the balanced scorecard. Web.
Martello, M., Watson, J., & Fischer, M. (2008). Implementing a balanced scorecard in a not-for-profit organization. Journal of Business & Economics Research, 6(9), 67-80. Web.
Murby, L., & Gould, S. (2005). Effective performance management with the balanced scorecard: Technical report. Web.
Niven, P. R. (2014). Balanced scorecard evolution: A dynamic approach to strategy execution. New York, NY: John Wiley & Sons.
Pramudita, C. D. (2016). The balanced scorecard as strategic controlling instrument. Hamburg, Germany: Anchor Academic Publishing.