Balanced Scorecard - Research Paper Example

The Balanced Scorecard s Introduction This present research paper mainly focuses on the Balance Scorecard of Dual-Tech Inc, which is a fictional organization that specializes in the selling and distribution of electrical appliances. The research paper will seek to describe how the balanced scorecard helps the management of Dual-Tech Inc to identify important information requirement. Secondly, the research paper will identify the information systems that Dual-Tech Inc will use to obtain information pertaining to each scorecard component.

The Balanced Scorecard Kaplan and Norton (1996), in their studies described the balanced scorecard as, “a management system that facilitates organizations to clarify their strategy and long-term objectives, and then enforce them.” Secondly, the balanced scorecard enables business enterprises to improve continually on their results and strategic performance by provide them with feedback regarding internal business processes and external outcomes. Voelpel et al. (2006) stated that the balanced scorecard is important to any organization because it is a key ingredient in any successful business.

How the balanced scorecard helps in identify information requirements The balanced scorecard has four key components or perspectives that enable the management of an organisation to clarify its strategy and long-term objectives and even enforce them. These four components of the balanced scorecard also represent the integral features of an organization that can determine its success. Therefore, it is correct to assert that the four key components of the balanced scorecard help the management of an organization to identify important information requirements that are necessary for the success of the business.

The image below is illustrates the balanced scorecard and the four components or perspectives. From the image above it is noted that the balanced scorecard helps the management to identify important information regarding the financial position of the organization, the customer base of the organization, the aspect of learning and growth within the organization, and information pertaining to internal functions. On each component or perspective, the balanced scorecard has listed four different information that it requires to implement the management system.

These four critical information requirements comprise of the objective, the measures, the targets, and the initiatives of each component. This is to say that upon look at the balanced scorecard framework, the management of Dual-Tech Inc will be able to identify crucial information that it will need to implement the management system and thereby be able to reap benefits attributed to utilization of the balanced scorecard (Kaplan and Norton, 1996). Information systems that are used to obtain information for each scorecard component Voelpel et al. (2006) in their studies described information systems as integration of individual activities and information technology, which supports the decision-making process, overall management of an organisation, and other critical operations within an organization.

As noted above, the management of Dual-Tech Inc will need different critical information pertaining to the four components of the balanced scorecard in order to implement the balanced scorecard. In this regard, the management of Dual-Tech Inc will obtain these information from various information systems that are clustered under the executive support systems. The information systems that will be used to obtain information include management information systems, decision support systems, knowledge management systems, transaction-processing systems, and office automation systems (Voelpel et al. 2006). All these information systems are designed to assist senior managers in making key decisions, as they collect, analyze, and summarise crucial external and internal information about an organization.

ReferencesKaplan, R. and Norton, D. (1996). "The Balanced Scorecard: measures that drive performance", Harvard Business Review Jan – Feb pp. 71–80Voelpel, S., Leibold M., Eckhoff R., and Davenport T. (2006), The tyranny of the Balanced Scorecard in the innovation economy, Journal of Intellectual Capital, Vol. 7 (1), pp. 43– 60.