Balanced Scorecard & Tableau de bord - Essay Example

? Balanced Scorecard & Tableau de bord Presently much focus has been put on the strategic systems ofmeasurement with the balanced scorecard being regarded and the best and the one that is highly rated. This approach that has its origin in the United States has not been received well in France whereby another system called tabuleau de bord has been in use for more than fifty years. This paper discusses the differences and similarities between the two systems of measurements by reviewing their strengths and weaknesses and then recommending the balanced scorecard as the best to be used by the companies. Introduction Lately there has been an increased performance measurement’s system evolution. The use of measurements that are non-financial, together with more conventional economical, has become a common recommendation; even though its uses are not something new, they were only developed fully during then nineties (Anthony &Dearden, 2007, p23). The relationship between the process of strategic planning and measurement of performance has been emphasized, at all the levels of a corporation. Presently, the most highly rated system of strategic measurement is the balanced scorecard. Nevertheless, the balanced scorecard has actually brought about serious attention particularly in the United States of America, as well as in some other several countries (Atkinson, Waterhouse and Wells, 2007, p.43). However, in France, the system of performance measurement has not been welcomed with much enthusiasm like in the other countries. The academic reticence of France relies mainly on the fact that the French companies have used for more than fifty years a literary dashboard (tableau de bord), which is much more similar to the balanced scorecard. It is argued by some writers that the establishment of the balanced scorecard could have been inspired by this precedence. This paper is going to carry out a comparative analysis between the two systems of performance measurements, whereby their advantages and disadvantages will be analyzed (Kaplan and Norton, 2002, p.93). Similarities and differences between the balanced scorecard and tableau de bord It is important to first have a brief description of the two systems of performance measure before discussing their similarities and differences. Balanced scorecard Since the year 1992, several articles and texts have been dedicated to the balanced scorecard. However, those who mostly advocated for the approach are Kaplan and Norton. Moreover, several publications have stressed its general deployment conditions or reported particular experiences. It translates a business unit’s strategy and vision into goals and measures of performance in four various areas namely; the financial, client, perspectives of growth and learning and internal business process (Kaplan and Norton, 1993, p.83). The financial viewpoint identifies the way the corporation wishes to be seen by its shareholders. The customer viewpoint identifies the way the corporation wishes to be seen by its clients. The internal business process viewpoint highlights the business process whereby the corporation has to be specifically proficient for the purposes of satisfying its clients and shareholders. This explanation results in the identification of the major indicators of process that the corporation wishes to manage and which will be party to the balanced scorecard itself (Jenkins, 2000, p.73). Usage and effectiveness among the survey respondents Tableau de bord It is not an easy thing to describe the tableau de bord. The tableau de bord is old as compared to the balanced scorecard, and this means that it has gone through several changes since its inception. There are several versions of it than the balanced scorecard. In French, we find that the ‘tableau de bord’ refers to the dashboard, and therefore the manager is figuratively compared to a pilot. In accordance with this culture, it is a tool meant for the company’s top management, giving it a quick and worldwide look of its operations as well as of the nature of its surrounding (Kaplan and Norton, 1996, p. 73). It was developed as a result of the decision making’s local accounting data. In France, the fairly small size of companies, their owners’ frequent management, and the income taxes’ creation would have led to the diversion of the financial accounting from the production of data that is applicable for the management’s use. This system would have ten attained the management tools need, considering the lack of data that is accounting-based (Eccles, 1991, p.34). Similarities and differences There are several common points between the two systems of performance measurements. For instance, they both aim at the avoidance of the monopoly of measures of financial performance. In addition, they have an assumption that expectation is more significant than reaction. They also suggest the selectivity of systems of measures that aim at the avoidance of surplus information. Taking a look at the differences between the two different systems of performance measures, we find that they are hidden beyond the similar appearances (Bendix, 2006, p.73). This means that there are two differences in the manner in which both of them closely relate objectives, measures of performance and strategies within a causal context. Clear evidence in in their implementation process and the last one is about their relationship to incentives or rewards. The differences are as discussed below: The fundamental strategic concept is not the same: For the balanced scorecard, we find that it is the (1980, 1985) model of Michael Porter. On the other hand, the tableau de bord does not exclusively depend on any particular strategic ideal but on the strategic representations of the managers (Black, 2002, p.86). Underlying relationships of associations are more open in the tableau de bord as compared to the balanced scorecard. In the balanced scorecard, the relationships of cause and effect between the four measurement areas are assumed, and the presence of a generic performance model which is applicable to all kinds of corporations. In the tableau de bord, there is not any assumption of the external and systematic causality; that is the manager establishes the entire path from the goals to the measures (Lawler, 2008, p.38). This implies that their subjectivity together with the environment play a significant role in the designing of the device of management. The balanced scorecard is regarded as a device that is more ready-to-use as compared to the tableau de bord (Barsoux, & Lawrence, 1990, p.63). This is because in the tableau de bord, the managers are forced to adapt a process that is very generic to their own framework. The hierarchical tableau de bord’ construction process of the balanced scorecard and the tableau de bord; in the balanced scorecard, we find that the implementation process occurs via the process of atomic analysis, whereby the goals of the top management cascade to the lower levels. Moreover, the deployment of objectives needs negotiation and dialogue between the different levels, and involves the local perquisite for the selection of the local action variables, on the basis of the commonly accepted concept or notion that the local manager or supervisor has the necessary knowledge about their own business or operations (Bourdieu, 2000, p.66). In addition, the tableau de bord is considered as a special way of making the administrators or managers think about process and not duty, collective and not local, cross functional and not specialized. Apparently, this dissimilarity in the process of implementation is partially a result of the two initially cited differences (the model of predetermined performance and the model of underlying strategy). It provides qualitative data regarding the perceived qualitative goals (customer service, high standards and individual involvement). It enables the differentiation of the rewards basis, which were initially nearly wholly based on the financial results, even though without having to give up the instrumental objectivity that is brought by the figures (Bourdieu, 1996, p.53). In the tableau de bord, no such stress exists. Oppositely, the French writers put the stress on the learning; that is if the measure of performance is given a norm of reference in the tableau de bord, then it is more for the learning purposes (from the reference) as compared to for the controlling (a standard). More so, it is not the tableau de bord’ dominance purpose to make the workers responsible for the outcomes but instead to give information regarding what is taking place and what is going to take place (Alvarez, 1998, p.64). Another common argument is that the process of design of the tableau de bord system of performance measure is at least as essential for the improvement of the company’s management as its result- the tableau de bord. Recommendation After reviewing the similarities and differences between the balanced scorecard and tableau de bord, which involves their advantages and disadvantages, it is recommended that companies use the balanced scorecard as a tool or system of financial measurement as it is much better than the tableau de bord. It should be noted that the tableau de bord has not been translated in any other language and remains in its original language. This lack of appropriation might express an implied refusal to seriously taking into consideration an approach that is from without. In the deployment of the tableau de bord, it would not really honor its promises. Whatever the theoretical claim that it has for the non-financial measures, it would overstress the financial measures. It is also shown that it is longer than required according to the texts and also that it is majorly directed internally and not adequately centered on the benchmarks. Whereas the tableau de bord attempts to establish dependable and consistent theoretical frameworks for its suggestions, it does not generally pay sufficient attention to the formation of agreement. On the other hand, the balanced scorecard is ordinarily more pragmatic. Although it has its weaknesses, its deployment practically reveals a restrained intuition regarding the management control’s nature. References Alvarez, J.E. (1998). The Diffusion and Consumption of Business Knowledge.London: Macmillan Press. Anthony, R. N. &Dearden, J. D 2007, Management control systems, 3rd ed., Homewood (Ill.): Irwin. Atkinson AA, Waterhouse JH, Wells RB 2007, ‘A stakeholder approach to strategic performance measurement.’Sloan Management Review, Spring. p. 25–37. Barsoux, J.L., & Lawrence, P 1990, Management in France. London: Cassel Education Ltd. Bendix, R 2006, Work and Authority in Industry: Ideologies of Management in the Course of Industrialization. New York : John Wiley. Black M 2002, Models and metaphors. Ithaca, NY: Cornell University. Bourdieu, P 1996, The State Nobility, Elite Schools in the Field of Power. Polity Press. Bourdieu, P 2000, Acts of Resistance, Against the New Myths of Our Time. Polity Press. Eccles, R.G. (1991). ‘The Performance Measurement Manifesto.’Harvard Business Review 69, 1, 131-37. Jenkins, A 2000, Employment relations in France, New York: Kluwer Academic/Plenum Publishers. Kaplan RS, Norton DP 1996a, The balanced scorecard: translating strategy into action. Boston, MA: Harvard Business School Press. Kaplan RS, Norton DP 2002,‘The balanced scorecard: measures that drive performance.’ Harvard Business Rev. Kaplan RS, Norton DP.1993, ‘Putting the balanced scorecard to work.’Harvard Business Rev. 134–47. Lawler, E. E. 2008,Motivation in work organizations, Monterey (Ca.): Brooks/Cole. Lebas, M 1996,Management accounting practice in France. Oxford: Oxford University Press; 1996. p. 74–99. APPENDIX A Usage and effectiveness among the survey respondents APPENDIX B Read More