ABSTRACT

The Balanced Scorecard (BSC) is a business framework used for

tracking and managing an organization’s strategy. This helps companies
to clarify strategy, monitor progress, and define & manage action
plans. It ensures that the company is moving forward towards achieving
its Mission, Vision and Objectives and sees to it that it is operating
effectively and efficiently. BSC assesses Four Key areas - Learning &
Growth Perspective, Internal Process Perspective, Customer Perspective
and the Financial Perspective. This study was conducted to evaluate
the overall performance with the application of the Balance Scorecard
using the four (4) perspectives in performance measurement and
strategic management system at Petromar Trade and Service Center
focusing with its Lubricants (Lubes& Oils) Business, with the data
being collected through interview with the management and
questionnaires floated to its customers selected randomly. The study
found out that employees equipped with skills through trainings and
seminars that builds a culture of information sharing and helps the
business to run smoothly establish a good relationship to their
customers by providing quality products and services which makes the
business profitable; these shows that the Petromar Trade has a good
overall performance and achieved its objective that makes them active
until these days.

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 INTRODUCTION

“To win in the marketplace, you must win in the workplace.”

-Douglas Conant

Business’ overall performance determines the status and health

of the company, how well the company performs in the competitive
world. Its performance also depends on how good their strategy was
and how the company follows it.

Business Strategy plays a very important role in the industry; a

good strategy helps businesses to make plans for their development in
both current and long-term goals. However, coming up with a good
strategy is not always simple.

Nowadays, many businesses are being influenced by the

continuously changing business environment, so management tends to
have all possible precautionary measures to prevent or avoid
unnecessary events that may happen to the business. Despite of these
changes and other events happening inside and outside the business,
balance is very important, setting the business’ goals and objectives
and how it will be implemented.

Balanced Scorecard (BSC) is a management system that focuses on

the big-picture strategic goals of the organization. It also helps the
management to choose the right things to measure so that it can reach
those goals. Some businesses measure the business’ health by how much
money they make, but they only see a part of the picture. It is based
on having measurable goals and outcomes based from the Four Key areas
of the organization namely; Learning & Growth, Internal Processes
(Operations & Productivity), Customers & Markets, and Financial.

As mentioned above, to set strategic goals and objectives, the

management need to look at these Four Key areas of the Organization;
The Financial Area (Finance & Stakeholders) is the major focus of the

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balanced scorecard, it focuses on the financial health of the
organization and answers the question “How the organization look to
its shareholders or owners?”. The Customer (Customers& Markets) Area
talks about how do the customers see the business, it focuses on the
people who actually buy its products and services; customer
satisfaction is an indicator of its success. The Internal Processes
(Operations& Productivity) Area tells about how smoothly the business
is running considering its Operations Management, Customer Service,
Regulatory & Social, and Innovation Processes. The Learning & Growth
Area a skill- based perspective that the business need to look at, it
determines the necessary skills and training modules required for the
successful implementation of the company’s processes. These areas
shows an idea for the business to improve more, by training the
employees and build a culture of information sharing (Learning&
Growth), to make the company run more smoothly (Internal Processes).
A better running business takes better care of its customers
(Customer), and happy customers buy more of what you’re selling
(Financial).

Petromar Trade, a sole proprietorship business established on

December 1994 and owned by Mr. Lorenzo R. Martinez, is a dealership
type of business getting its supplies from Petron, it starts with a
service station, and immediately followed by Lubricants Business, Car
Care Center and Emission Testing Center. Four businesses in one
compound, owned by a sole proprietor, indeed it was hard to manage but
with the proper strategy and implementation, it is still performing
well until this day.

This study was conducted to evaluate the performance of Petromar

Trade and Service Center focusing with its Lubricants (Lubes& Oils)
Business using the four perspective of balanced scorecard. The
researchers aim to study if balanced scorecard is applicable in this
type of business.

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 METHODOLOGY

The researchers used the quantitative and qualitative methods of

research. The qualitative method includes the interview to the
management of the company for the evaluation of the learning and
growth perspective, internal business process, and financial
perspective. And the quantitative method is used to measure the level
of satisfaction of the customers for customer perspective, which is
rated as follows:

 Regarding the services of the agents of the Petromar Trade: 5- Very

Satisfied, 4- More than Satisfied, 3- Satisfied, 2- Partly Satisfied
and 1- Not Satisfied at all about.
 Regarding the performance of the agents as an employee of the
Petromar Trade: Yes- Satisfied and No- Not Satisfied.

The study was limited to Petromar Trade and Service Center,

primarily on lubes and oils, at Buntun Highway, Tuguegarao City,
Cagayan. In its customer perspective and learning and growth,
questionnaires are floated to the 5 customers of Petromar Trade which
are selected randomly. On the internal business process, financial,
and learning and growth perspective, interview was conducted in order
to gather data.

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 RESULTS AND DISCUSSIONS

A. Learning and Growth Perspective

Due to the nature of the Petromar Trade, the employees are mostly
composed of agents, who directly deals with customers and office
employees who deals with management.

Through an interview, the researchers learned that the Petromar

Trade conducts a weekly assembly of its agents for them to keep track
of their concerns in dealing costumers and gathering suggestions for
improvements. As a part of their dealership, a yearly assembly is
being conducted by the main office of Petron, for them to be
knowledgeable about the updates on the products and methods in
handling decision making. Through the survey with the customers of
Petromar Trade, the researchers have proved that these programs were
effective by their responses on the questions.

B. Internal Perspective

Petromar Trade introduced their product through brochures and

maintained their inventories through First-In-First-Out (FIFO) basis.
In relation to this, they maintain one month inventory as a safety
stock in case of out-of-stock products, so that sale quotas won’t be
affected since this acts as their benchmark to measure if the budgeted
sales are met as Petromar Trade is more of Profit Center. It complies
with all the legal requirements of the government and continuously
complies with standards thus, no legal problems have been met.
Petromar Trade sponsors programs and activities as part of its
responsibilities in the society and assures that they conduct a
regular visit to its customers and their goal is that all carried
Petron products should be available in one customer outlet. As to its
stakeholders, the company maintains a win-win relation with them.

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 Based on the findings, the company achieved its objective to be
an important part of the customers’ lives, to bond strong ties with
its stakeholders, to showcase value proposition, to maintain social
responsibility and promotes the best for its stakeholders, thus
implies, that the goal of the internal process perspective is met
which states that its ultimate goal is related to the business’
objectives.

C. Customer Perspective

The customers are overall satisfied with the quality and the
services provided by the Petromar Trade which implies that the
products of the company are of good quality and the services they
provide is reliable and able to meet the expectations of its
customers. Lately, the Petromar uses Customer Loyalty Program as a way
to attract customers but they switched to discounts because they found
it more effective than the previous customer loyalty program.

Based on the study, an average of 3.88 which is nearly to more

than satisfied is the result of satisfactoriness of the customers of
Petromar Trade as to the services provided by their agents, as to the
delivery time of the products, as to the meeting of needs and demands,
as to the quality of products and as to the way of accommodating
orders. This justifies that the customer’s perspective of Petromar
Trade is of good and satisfactory state and further proves that
Petromar Trade is aligned with its mission to provide products and
services that are competent, competitive and customer-oriented in its
area of coverage while maintaining its business growth and excellence.
Regarding the satisfactory of the customers to their agents, Customers
are very satisfied as to the knowledge and performance of their agents
that makes the Petromar trade earns loyalty and trust of their
customers.

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D. Financial Perspective

Petromar Trade is a sole proprietorship kind of business of

dealership where in there is no franchise fee being paid to the Petron
Corporation but they are given targets wherein it will be the basis of
their operations. The latter focuses on its Return on Investment. The
financial performance of the company wherein its ROI is met based on
the target given by the Petron Corporation. The prices of the
products, lubricants, are based on the Wholesale Posted Price, wherein
they cannot add or deduct price in a given product in their own. The
performance of the company is on the basis of liters of product they
sell in a month.

The liters that must meet as their monthly target is on a

seasonal basis coming from the main company and normally the peak
seasons are June and September wherein they reach the 140-150
thousands liters of lubes and oils.

They use the FIFO method of checking their inventory and these is
a daily checkup of the inventories. If there are leaks in the product,
they return it to the suppliers. They see to it that the product is a
quality Petron Products. The lead time of ordering a product from the
supplier up to the company is 4 days – 1 day on ordering, 1 day travel
to pick up, 1 day loading of inventory and 1 day travel back to the
company and unloading of inventory. Also, the Train Law affects the
sales of the company since there is a price increase in the products
so the customers seek to a cheaper price.

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 CONCLUSIONS AND RECOMMENDATIONS

Conclusions

A. Learning and Growth Perspective

The learning and growth perspective of Petromar Trade showed a

constant empowerment of their employees equipping them with skills
through seminars and trainings necessary to provide a quality service
to its customers.

The employees actively sharing suggestions on how to improve

their service and they were also given incentives.

B. Internal Process Perspective

In the Internal Process Perspective, it covers the practices in

the work place, its social responsibility, compliance of legal
requirements and its relations to its stakeholders. Petromar Trade has
a good performance as to its workplace and continuously performing in
order to attain the company’s objectives.

C. Customer Perspective

Based on the survey conducted by the researches, the customers of

Petromar Trade were satisfied with the products and services given to
them, which is in line with their mission to provide quality products
and services, making them earn loyalty and trust from their customers.

D. Financial Perspective

The financial perspective of Petromar Trade is mainly controlled

by its main distributor, Petron Corporation. They were given a monthly
target Return on Investment (ROI) which it must be met.

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Recommendations

Based on the findings of this study, the researchers would want to

recommend the following:

To Petromar Trade

To continue performing well in the work and market place,

Petromar Trade should search for their prospective customer and
improve its business strategy through consistent planning and
educating its frontliners.

To Employees and Agents

Employees and Agents should continuously improve their

performance and must attend the seminars and trainings offered by
Petromar Trade and the main Petron.

To Customers

Customers must be knowledgeable of the products offered to them,

not only as to the price but also on the specifications of the
products.

To the Academe

The researchers recommend that academe use this study as

additional resource for balanced scorecard in a dealership type of
business.

To the Future Researchers

For the improvements of this study, the researchers recommend to

the future researchers, who may want to conduct further research with
the same study to broaden the number of respondents in customer
perspective and use other tools of research for the three remaining
perspective- financial, internal and learning & growth.

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 REFERENCES

1. Performance Evaluation of ISELCO I using Balanced ScoreCard

by Ingrid Faye P. Calayag, Mary Fe D. Rivera, Clarizza Joyce
A. Sagyawan, Iris Joy A. Cortez, Lyra Princess A. Mabalot,
and Ma. Concepcion T. Jalijali, CPA
2. Introduction to Balanced Scorecard & Measurement Tools –
Maher Akwan from youtube.com
3. Balanced Scorecard Lesson – ManagerPitstop.com from
youtube.com
4. 10 Steps to Creating a Balanced Scorecard-kellyxsj from
youtube.com
5. Balanced Scorecards from BalancedScorecards.com
6. What is a Balanced Scorecard? from www.bernardmarr.com

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‘Appendices’

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