Académique Documents
Professionnel Documents
Culture Documents
By
VELUSAMY.NP
(REG. NO. 0929170)
A PROJECT REPORT
Submitted to the
I sincerely thank all the staff members of the Crescent Business School for their
valuable advice and kind cooperation, without which the project would not have emerged
as a successful one.
LIST OF ABBERIVATIONS
BSC – balanced scorecard
FTE – Full Time Employee
CU – capacity utilization
SU – seat utilization
CRM- customer relationship management
TQM – Total Quality Control
BG – Business Group
SBG - Sub Business group
RMS – Residential mortgage service
CSG – commercial servicing group
DD – Due Diligence
LA – Lease Administration
TAT – Turn Around Time
CSAT – Customer Satisfaction
FPY – First Pass Yield
CHAPTER – 1
1.1INDUSTRY PROFILE:
Real estate in United States is one of the largest markets in the world. In fact, it is so
significant to world economic activity that the availability of easy money and the
subsequent Housing Bubble triggered the Sub-Prime Crisis and eventually the global
Financial Crisis of 2008 - 2009 that brought the world's economy to its knees. The US
real estate market is divided into 2 sectors: commercial real estate and residential real
estate. Most discussion tends to focus on residential real estate (i.e. houses), but
commercial real estate is also a critical sector of the economy, and is made up of offices,
shopping malls, factories, warehouses and other commercial buildings.
Property managers
Property managers focus on the day operation of the asset. Property managers
carry responsibility for all respects of the physical space in accordance with the asset
manager's plan. The responsibilities of a property manager include:
• Marketing and leasing
• Maintenance and repair
• Tenant relations including rent collection
• Insurance
• Accounting
• Human resource management
• Providing timely information to the asset manager about events affecting the
property.
Some of the major property managers include Trammel Crow Company and Grubb and
Ellis Company.
With 4,500+ employees worldwide, Zenta has operations in six locations across
three continents. Zenta is a preferred employer in India.
From origination and throughout the customer lifecycle, Zenta delivers deep, end-
to-end servicing solutions. Zenta's specialized focus on the financial services industry and
our management expertise and experience, are the reasons we have been chosen to
provide high-end business processing for some of the world's most prestigious banks and
financial institutions.
Client Focused:
We're passionate about our clients and are easy to do business with. We sell our
clients what they want to buy, how they want to buy it. We are flexible and responsive,
tailoring our solutions to our clients' unique needs. And we honor our commitments.
Employee Centric:
We provide our employees with rewarding and satisfying career opportunities
based on their personal performance and contribution.
Cultural Compatibility:
Our clients are primarily in North America and Europe. Our operations are
primarily in India. We must be adept at managing and leading in multiple cultures. We
have assembled a diverse management team that understands the Western business
environment and the needs, aspirations and motivations of our global work force.
Ethics:
The line between right and wrong is not gray or blurred. It is a bright line and we
will not cross it, nor will we tolerate anyone who does
Operational Excellence:
We are committed to operational excellence. We employ a global work force. We
capture work anywhere in the world, move it to wherever in the world we can find the
right blend of cost and quality to work and deliver it back to our clients, wherever in the
world they may be
Accountability:
We hold ourselves accountable for results. We push decision-making to the
lowest possible level. When approvals are required, they are given as rapidly as possible.
Our business leaders are experienced outsourcing industry professionals from global
companies. We have an exceptional track record of attracting and retaining senior talent
with both global exposure and domain expertise to meet our clients' unique business n?
ends.
1.3 NEED FOR STUDY
1. Creating a winning strategy is only the first part of your Balanced Scorecard
implementation. The next part is measuring the success (or "failure") of your
strategy.
2. Besides the Balanced Scorecard, performance measurement systems have mainly
focused on lagging financial indicators. Although non-financial measures have
existed for long, their link to strategy and financial results has been vague at best.
On the contrary, the Balanced Scorecard provides predictive, forward-looking
views of the overall business that go beyond a focus on short-term bottom-line
results
3. Measuring your strategy enables you to confirm or set aside the assumed causes
and effects you have based your strategy on. This is vital information. Your
strategy is based on what you believe influences the perspectives the most.
Keeping track of the right measures and communicating the success or failure to
achieve the target values of such measures help everyone focus on the issues that
matters most.
4. If this doesn't happen, then the assumption on which our strategy is based may be
wrong and we may have to rewrite our strategy. Getting this kind of information
to your desk fast may save you from total embarrassment. Confirm or disprove
your ability to achieve what you have planned to achieve. Had the desired effect
on your ability to deliver internal processes end objectives
1.4 OBJECTIVES OF THE STUDY
Balanced scorecard was the one the key control tool to manage the organization
effectively according to the strategy which is implemented. Objectives are diversified
into primary and secondary
PRIMARY OBJECTIVE
SECONDARY OBJECTIVE
1. The Balanced Scorecard enables organizations to bridge the gap between strategy
and actions, engage a broader range of users in organizational planning, reflect the
most important aspects of the business, and respond immediately to progress,
feedback and changing business conditions. The Balanced Scorecard can be a
great help used as a strategic tool, a management methodology or / and a
measurement system.
2. The Balanced Scorecard provides organizations with the ability to clarify vision
and strategy and translate them into action. By focusing on future potential
success it becomes a dynamic management system that is able to reinforce,
implement and drive corporate strategy forward.
3. The Balanced Scorecard is based on performance measurement and derives its
objectives from vision and strategy. It enables shared understanding of the links
between strategy, critical success factors and actions while establishing
accountability
4. The concept of the Balanced Scorecard has achieved increasing popularity in the
business world. Many businesses had previously built their objectives around
financial targets and goals of little relevance to a long-term strategic vision, thus
typically leaving a gap between strategy development and implementation.
5. The Balanced Scorecard is based on performance measurement and derives its
objectives from vision and strategy. It enables shared understanding of the links
between strategy, critical success factors and actions while establishing
accountability
6. The Balanced Scorecard focuses on creating and communicating a total
comprehensive picture to all members of the organization from the top down,
taking a long-term view of what the company's strategic objectives really are,
making good use of knowledge gained through experience and maintaining the
required flexibility of such a system to cope with the fast-changing business
environment.
1.6 STUDY METHOD
A qualitative study was chosen because metric to be analyzed was vast. The study
is focused on how Zenta’s internal metrics can be fitted to the balanced scorecard
concept.
Kaplan and Norton’s book “balanced scorecard” is taken as base and collected data for
this project
LITERATURE REVIEW
HISTORY
Throughout the history of contemporary management theories starting from the
ones that were introduced between the intrusion of the mass production in the beginning
of the 20th century and until today, all the gurus of management have been trying to find
uniform solutions on more efficient allocation and use of very limited resources available
to businesses.
In the down of the century, Frederick W. Taylor established the very concepts of
resource allocation in his Principles of Scientific Management. In 1920 it went around
assembly line and motion studies as the first experience from systematic mass production
had given theorists quite a lot of materials to be analyzed from the point of view of using
traditional by blue-collar employees more efficiently. In the 1930, the main topic was
motivation of employees, as it turned out that human nature does not enable to work long
hours on a repetitive tasks without frustration level getting so high enough to diminish
productivity. In the 1940 and 1950, the first statistical and linear methods were
introduced in trying to measure logistics of the operations management and its
implications to overall company success in financial-analysis side.
In the beginning of 1980, partly because of introduction of electronic data
processing equipment and quick development of computers, the whole array of
management techniques were initiated. The particular reasons for the vast development of
the new theories were catalyzed mainly by ever growing competition generated through
more systematic use of computers, and of course also by rapid growth of the importance
of human capital.
During the industrial age, the financial control systems were developed in major
companies to facilitate and monitor efficient allocations of financial and physical capital.
A summary financial measure such as return-on-capital-employed (ROCE) could both
direct a company’s internal capital to its most productive use and monitor the efficiency
by which operating divisions used financial and physical capital to create value for
shareholders.
The emergence of the information era, however, in the last decades of the 20th
century, has made obsolete many of the fundamental assumptions of the industrial age
competition. The information age environment for both manufacturing and service
organizations requires new capabilities for competitive success. The ability of any
company to mobilize and exploit its intangible assets has become far more decisive that
investing and managing tangible, physical assets.
Today automation and productivity have increased the number of people
performing analytic functions: engineering, marketing, management and administration.
Therefore, these people are more viewed as problem solvers, not as variable costs. In
other words, information age ahs brought about the concept of knowledge management.
The shift to successful knowledge management has introduced a variety of improvement
initiatives such as; JIT, TQM, Lean enterprise, Time-based competition, Customer-
focused organizations etc. Some of those programmers have meant in practice real
breakthrough and improvement, others have proven to be in the best case just a short-
time disturbance, but in the worst cases total failures resulting in disarray or even
bankruptcy of a particular company. The main reason for that lies in five main
implementation problems:
1. Current performance measurement systems are based on the traditional financial
accounting model, which does not enable to objectively analyze information-age
companies;
2. If some non-financial performance measurement even is made, it is solely based
on employees’ tactical performance, not on strategic performance,
3. Majority of management and employee salary-based motivation schemes are only
short-run profit oriented, that does not enable to align towards long-run profit
oriented, that does not enable to align towards long-run goals;
4. Overall company strategy is not closely linked to organizational and personal
improvement programmers; and
5. Strategy is not generally linked to resource allocation, which results in under
financing some of the crucial parts of organization’s development.
As for today, superior financial performance and efficiency in production are just not
enough to gain sufficient competitive advantage but more and more attention needs to be
paid to intangible sides of business.
The balanced scorecard has evolved from its early use as a simple performance
measurement framework to a full strategic planning and management system. The “new”
balanced scorecard transforms an organization’s strategic plan from an attractive but
passive document into the "marching orders" for the organization on a daily basis. It
provides a framework that not only provides performance measurements, but helps
planners identify what should be done and measured. It enables executives to truly
execute their strategies.
Kaplan and Norton's first book, The Balanced Scorecard, remains their most
popular. The book reflects the earliest incarnations of Balanced Scorecard - effectively
restating the concept as described in the second Harvard Business Review article. Their
second book, The Strategy Focused Organization, echoed work by others (particularly in
Scandinavia) on the value of visually documenting the links between measures by
proposing the "Strategic Linkage Model" or “strategy map”. Since then Balanced
Scorecard books have become more common - in early 2010 Amazon was listing several
hundred titles in English which had Balanced Scorecard in the title.
Kaplan and Norton describe the innovation of the balanced scorecard as follows:
"The balanced scorecard retains traditional financial measures. But financial measures
tell the story of past events, an adequate story for industrial age companies for which
investments in long-term capabilities and customer relationships were not critical for
success. These financial measures are inadequate, however, for guiding and evaluating
the journey that information age companies must make to create future value through
investment in customers, suppliers, employees, processes, technology, and innovation."
Adapted from Robert S. Kaplan and David P. Norton, “Using the Balanced Scorecard as a Strategic Management
System,” Harvard Business Review (January-February 1996): 76.
Figure 2.1
The balanced scorecard suggests that we view the organization from four
perspectives, and to develop metrics, collect data and analyze it relative to each of these
perspectives:
Kaplan and Norton emphasize that 'learning' is more than 'training'; it also includes things
like mentors and tutors within the organization, as well as that ease of communication
among workers that allows them to readily get help on a problem when it is needed. It
also includes technological tools; what the Baldrige criteria call "high performance work
systems."
Kaplan and Norton do not disregard the traditional need for financial data. Timely
and accurate funding data will always be a priority, and managers will do whatever
necessary to provide it. In fact, often there is more than enough handling and processing
of financial data. With the implementation of a corporate database, it is hoped that more
of the processing can be centralized and automated. But the point is that the current
emphasis on financials leads to the "unbalanced" situation with regard to other
perspectives. There is perhaps a need to include additional financial-related data, such as
risk assessment and cost-benefit data, in this category.
There are three principles which will enable the organization’s balanced scorecard to be
linked to its strategy
• Cause and effect relationship
• Performance drivers
• Linkage to financials
Cause Effect
Then
Cause and effect relationship for training
All balanced scorecards use certain generic measures. These generic measures
tend to be core outcome measures, which reflect the common goals of many strategies as
well as similar structures across industries and companies. These generic outcome
measures tend to be lag indicators, such as profitability, market share, customer
satisfaction, customer retention, and employee skills. The performance drivers, the lead
indicators are the ones that tend to be unique for a particular business unit. The
performance driver reflect the uniqueness of the business unit strategy; for example, the
financial drivers of profitability, the market segments in which the unit chooses to
complete, and the particular internal processes and learning and growth objectives that
will deliver the value propositions to targeted customers and market segments.
A good balanced scorecard should have a mix of outcome measures and
performance drivers. Outcome measures without performance drivers do not
communicate how the outcomes are achieved. They also do not provide an earlier
indication about whether the strategy is being implemented successfully. Conversely, the
performance drivers – such as cycle time and part-per million defect rated – without
outcome measures enable the business unit to achieve short operational improvements,
but will fail to reveal whether the operational improvements have been translated into
expanded business with existing and new customers, and eventually, to enhance the
financial performance. A good balanced scorecard should have an appropriate mix of
outcome (lagging indicators) and performance drivers (leading indicators) that have been
customized to the business unit strategy.
LINKAGE TO FINANCIALS
With the proliferation of change programs under way in most organization today
it is easy to become preoccupied with such goals as quality, customer satisfaction,
innovation, and employee empowerment for their own sake. Will those goals can lead to
improved business unit performance, they may not if these goals are taken as ends in
themselves. The financial problems of some recent Baldrige award winners give
testimony to the need to link operational improvements to economical results.
A good balanced scorecard must retain a strong emphasis on outcomes, especially
financial ones like return–on–capital-employed or economic value added. Many
managers fail to link programs, quality management, cycle time reduction, reengineering,
and employee empowerment, to outcomes the directly influence customers and that
deliver future financial performance in such organizations the improvement programs
have incorrectly been taken as the ultimate objective they have not been linked to specific
targets and eventually financial performance. The inevitable result in that such
organization eventually become disillusioned about the lack of tangible payoffs from
their change programs. Ultimately, casual paths from all the measures on a scorecard
should be linked to financial objectives.
Although it helps focus managers' attention on strategic issues and the management
of the implementation of strategy, it is important to remember that the balanced scorecard
itself has no role in the formation of strategy. In fact, balanced scorecards can
comfortably co-exist with strategic planning systems and other tools.
In the mid 1990s, an improved design method emerged. In the new method,
measures are selected based on a set of "strategic objectives" plotted on a "strategic
linkage model" or "strategy map". With this modified approach, the strategic objectives
are distributed across the four measurement perspectives, so as to "connect the dots" to
form a visual presentation of strategy and measures.
To develop a strategy map, managers select a few strategic objectives within each
of the perspectives, and then define the cause-effect chain among these objectives by
drawing links between them. A balanced scorecard of strategic performance measures is
then derived directly from the strategic objectives. This type of approach provides greater
contextual justification for the measures chosen, and is generally easier for managers to
work through. This style of Balanced Scorecard has been commonly used since 1996 or
so: it is significantly different in approach to the methods originally proposed, and so can
be thought of as representing the "2nd Generation" of design approach adopted for
Balanced Scorecard since its introduction.
Several design issues still remain with this enhanced approach to Balanced Scorecard
design, but it has been much more successful than the design approach it superseded.
In the late 1990s, the design approach had evolved yet again. One problem with
the "2nd generation" design approach described above was that the plotting of causal
links amongst twenty or so medium-term strategic goals was still a relatively abstract
activity. In practice it ignored the fact that opportunities to intervene, to influence
strategic goals are, and need to be anchored in the "now;" in current and real management
activity. Secondly, the need to "roll forward" and test the impact of these goals
necessitated the creation of an additional design instrument; the Vision or Destination
Statement. This device was a statement of what "strategic success," or the "strategic end-
state" looked like. It was quickly realized, that if a Destination Statement was created at
the beginning of the design process then it was much easier to select strategic Activity
and Outcome objectives to respond to it. Measures and targets could then be selected to
track the achievement of these objectives. Design methods that incorporate a "Destination
Statement" or equivalent (e.g. the Results Based Management method proposed by the
UN in 2002) represent a tangibly different design approach to those that went before, and
have been proposed as representing a "3rd Generation" design method for Balanced
Scorecard.
Design methods for Balanced Scorecard continue to evolve and adapt to reflect
the deficiencies in the currently used methods, and the particular needs of communities of
interest (e.g. NGO's and Government Departments have found the 3rd Generation
methods embedded in Results Based Management more useful than 1st or 2nd
Generation design methods).
All of the listed variables can be measured to a useful degree of accuracy and
some companies are doing it. Companies that have won the Baldrige Award or similar
state award have extensive measurement systems that include all of the above measures.
So how can you determine what your company should measure? As mentioned
before, there are several frameworks that can be used. Although they all have merit, some
have advantages in terms of their state of development, ease of use, and direct
relationship to common business practices.
I believe the best approach for developing company or business unit strategy and
related measures is to use the Balanced Scorecard methodology in conjunction with the
robust perspectives of the Performance Prism. Balanced Scorecard performance systems
have an established record of success, but one needs a disciplined way of building and
implementing the system to ensure that business strategies get executed and that the
necessary organization culture change gets implemented. One framework that is
becoming an international "best practice" is the Balanced Scorecard Institute's Nine-Step
Methodology for developing strategic themes, business strategies, strategic goals,
strategy maps, performance measures, targets, and new initiatives. The result is a
strategic management system that is comprehensive, logically sound, and supported by
the whole organization.
This does not assure the strategies will work, but the measures will provide timely
feedback about how well they are working so timely corrective action can be taken
regarding the strategies or their execution. Without the measures, a company’s strategy
and finances could get substantially off-track before any problems are even recognized.
But having good strategies is not enough to be successful. Operational excellence
is also needed to execute them. To achieve and maintain high levels of productivity,
quality, and customer service, comprehensive operations or process measurement
systems are needed to manage processes, departments and work units. These systems
would include the measures that are strategically important, but those measures alone are
insufficient for effectively managing operations.
For developing operational measures, I recommend the approach and model given
in my book Operational Performance Measurement: Increasing Total Productivity. No
doubt I am biased, but the book’s process measurement model is the only one I’ve seen
that meets three critical criteria: it is logically sound, it readily relates to real world
processes, and it has a record of successful application. The model is also consistent with
TQM and Six Sigma methodologies that contain many specialized techniques for
measuring and managing processes.
Becoming familiar with the Baldrige Criteria for Performance Excellence is also
recommended. Since it outlines general management best practices, it provides a very
helpful perspective on what a well-managed company should be measuring, as well as
what it should be doing.
Cascading measures
Corporate level measures are very important, but they aren’t going to have much
impact unless they are cascaded all the way down to front-line employees. The case for
cascading is simple: Do you want 10% of your employees working toward company
objectives or 100%?
With some exceptions, such as market share, what you measure at the top is what
must be measured at all levels. However, the specific measures will change with every
function and organizational level because managers doing different jobs need different
information to make different decisions.
The same methodologies used to develop measures at the corporate level can be
used to cascade the measures down to front-line managers, supervisors, and employees.
However, as you go down the organization chart, the focus is on operations or processes.
Strategy is incorporated into operational measures by giving more weight to the measures
that are strategically important. This communicates strategy to all employees by
translating it into operational terms - a primary objective of the Balanced Scorecard.
Determining what to measure can take considerable effort, but it will probably be
less than one-third of the total effort required to implement an efficient and effective
measurement system. Data collection and processing systems will have to be
implemented to produce the measures; everyone will have to be trained in using the
systems and measures; and as the measures are used, some problems are sure to be
identified that will require changes to the system.
Research Methodology is the way in which the data are collected for the research
project.
TYPE OF RESEARCH:
In this study, the type of research is “Qualitative Research”
Collecting and analyzing this unstructured information can be messy and time
consuming using manual methods. When faced with volumes of materials, finding
themes and extracting meaning can be a daunting task.
CHAPTER 4
In ZENTA all business process operates separately under different BG’s it is classified
according to the nature of business. In Zenta there are five business groups
PRIMARY GOAL
VERTICAL GOAL
Goal flow
SBG level goal
Individual goal
Figure 3.1
Figure 4.1
The May 2007 realignment of the Company’s services under the Zenta brand reflects the
new corporate vision of building a world-class Knowledge and Business Process
Outsourcing Company focused on the real estate and financial services industries. As a
fully integrated global enterprise, Zenta now offers real estate and financial services
customers a broad array of services from its centers of excellence around the globe.
Financial objective
• High return on
investment
• Borden revenue Mix
Customer objective
• Improve customer
retention
• Deliver high
quality service
Business process
(Innovation cycle)
• Reduction in
cycle time
Business process
(Operational cycle)
• Achieve high CU
• Improve FTE competency
STAFF SKILLS
Improvement
Learning and growth
Objective
• vision communication
• Increase training Hrs Increase information
asset
Figure 4.2
4.3 METRIC ANALYSIS IN ZENTA
Seat cost
Internal business process
Customer perspective
Financial perspective
Figure 4.3
Transportation is simple metric but it will also impact in customer satisfaction and
retention. Transportation cost is considered as one of the key metric in financial
perspective of the company. Vehicle seat utilization is considered for knowing the total
number of employee using the company transport and how much the company paying for
it. Average travel time is calculated to identify to satisfaction level of the employee.
Average travel time: Time taken by the employee to reach destination from work place.
When average travel time for an employee is high it will lead to low employee morale.
Vehicle Seat Utilization: rate of occupancy of vehicles for a given route. If vehicle seat
utilization is high then transportation cost is lower but average travel time will be higher.
Average
Travel
Time
Transportat
ion Cost Customer perspective
Financial perspective
Vehicle Seat
Utilization
Employees are considered as important asset for any organization. Skill set for
Skillsplays
any employee per an important role in organizational development. All the employees
FTE (IT)
are trained according to the requirement of the respective business group. This training
makes the employee to be efficient in the work flow. Efficiency is considered as internal
business process metric when efficient employee is working in the process then there will
Efficiency
of work
no deviation from turnaround time (TAT). With low skills of the FTE’s the process time
will be more and this will lead to increase in the TAT.
Deviation
Learning and Growth
from TAT
Revenue
Generation
Internal business process
Customer perspective
Financial perspective
Figure 4.5
Skill per FTE (IT): the basic information technology skills which employees posses.
This will help in improving productivity or efficiency. The skill per FTE is increased
with help of training given by the organization.
Deviation from TAT: it refers to the increase in process time from the regular cycle
time. In order to meet desired TAT employees has to be trained as per requirement.
Revenue generation: Deviation from TAT is inversely proportional to revenue
generated. With the effective skills of employees the process time will get reduce, which
increases the workflow efficiency, which helps in revenue generation.
On time
delivery Customer perspective
Profitabilit
y
Financial perspective
Figure 4.6
Remedial
training
Remedial training : Specific remedial training for personnel may be required to
refresh and upgrade knowledge and skills related to their duties. A standard method of
implementing this training and evaluating the personnel involved should be established.
Zenta is following remedial training method to ensure efficiency in the process so that it
increases customer satisfaction. Defective
units
CSAT
Cost of
rework
Customer perspective
Financial perspective
Figure 4.7
Cost of rework: Rework cost is the standard or actual cost that is spent on correcting
defective work. Rework cost is an unnecessary and additional cost for the organization,
which affects the overall operating cost.
Asset CSAT
IT skills By quality of
per FTE utilization Profitability
service
The term asset utilization means proper utilization of internal facilities to the greater
extent. Higher asset utilization increases the profitability and decreases the overall
expense incurred by the organization. All the internal facilities are more of IT related so
employees also should posses IT skills to use the facilities effectively. This will result in
increase in quality of service to the customer, which is the base line for any organization.
The balanced scorecard framework for Zenta is formulated with the help of above
strategies given in the balanced scorecard approach figure. The final balanced scorecard
is shown in the table given below. This include two important strategies they are
• Strategic objective
• Strategic measurement
Strategic objective:
Strategic objective consist of four perspectives along with the metrics calculated
in Zenta this strategic objective is framed with help of vision and mission of the
company.
Financial perspective
In financial perspective balanced scorecard comprises of three important metric
which is considered in Zenta they are
• Improve financial Returns
o Broaden Revenue Mix
o Reduce cost Structure
To achieve higher financial returns there should be more area for revenue generation
which also helps organization to grow. Reduce cost structure is productivity term to
control cost in organizational process high cost reduction will impact in quality of the
service provided to the customers this will the lagging indicator.
Customer perspective
In customer perspective table, increase in customer satisfaction through superior
execution is the strategic objective (These objectives are considered for Zenta). To
increase CSAT employee in the organization should be well trained how to handle the
customer. How to serve them but making proper relationship will be challenge so this
will be in lagging indicator. There should a proper execution of service this will result in
high customer retention so market share in the segment will go up this will the leading
indicator.
INTERNAL BUSINESS
PROCESS
Understand Customer Segments Meeting Client Targets
High capacity utilization Business volume
Asset utilization No Tracking system
FTE competency Remedial training
Cycle time reduction Application Tracking Statistical Measure
Provide Rapid Application
Response(internal) Tracking(Track IT)
LEARNING AND GROWTH
Increase Employee Productivity Efficiency Drivers Application Support
Develop Strategic Skills Attrition Effective Work force
Access to Strategic Information Application
Restriction
Align Personal Goals Good Performance Appraisal
.
STRATEGIC MEASUREMENT
Strategic measurement has to main parts which will access the all the metric of
strategic objective the two parts of strategic measurement are
• Lagging Indicator
• Leading Indicator
Lagging Indicator
In balanced scorecard outcomes are called lagging indicators. It will determine
what to be improved in the company so that company can earn more. Lagging indicators
are not measured as leading but measuring lagging indicator will help organization to
change it to leading indicator
Leading indicator
In balanced scorecard leading indicators are the performance drivers which makes
company profitable. The leading indicator makes company to act according to the
strengths this will help them to achieve more in the market place. In strategic
measurement leading indicator will tell the strength of the company which was shown in
table below.
F ina nc ia l perspective
Broaden
R evenu M
e ix
For the revenue growth strategy, the financial perspective is to broaden the
revenue mix for the company. Strategically it is meant to increase the business process by
acquiring new clients and identifying new processes. In case of customer perspective,
increase customer confidence will be the key factor for the Zenta in customer retention.
Then the scorecard design focused on the internal business process perspective, Zenta has
three main objectives first is understanding customer segments, Zenta is an outsourcing
company understanding the customer needs and wants is important for better servicing.
All customers are not same so segmenting them according to there requirement and work
accordingly will increase their confidence. Second was to improve capacity utilization of
the company, CU is one of key metric measured in the company which helps to measure
the performance of the business group, there will a CU target which is to be achieved by
the all BG’s in the company but the target will be different according to the work flow of
the BG’s. High CU leads to higher revenue. Third will be the asset utilization this will
measure the resource utilization i.e. the internal facilities provided by the company to
their employees.
The next scorecard measure will be the productivity strategy, the financial
perspective is to improve the operating efficiency this achieved by implanting new
techniques which reduce the cost Zenta follows Kaizen tool as technique which helps to
reduce the production hours due to that cost is reduced. These both revenue growth
financial measure and productivity strategic financial measure will lead to more returns to
the company which helps to achieve the financial goal.
For customer perspective in productivity strategy is to improve the customer
satisfaction through superior execution this suggest that fulfilling customer wants and
needs with help of facilities available. In internal business process I am considering three
important productivity improvement strategies are measured they are
• Improve Competency of FTE
• Cycle time reduction this applicable for all business process
• Compliance to organizational policies
CYCLE TIME REDUCTION:
Cycle Time Reduction is identifying and implementing more efficient ways to do
things. Reducing cycle time requires eliminating or reducing non-value-added activity,
which is defined as any activity that does not add value to the product. Examples of non-
value- added activity in which cycle time can be reduced or eliminated include repair due
to defects, machine set-up, inspection, test and schedule delays. Reducing cycle time will
have a significant impact on a company's bottom line when implemented.
COMPLIANCE:
Conformity to the organizational policies or requirements to meet the overall
objectives. A system or framework developed internally to implement the above either
manually or application which will help in controlling and monitoring of key metrics.
All this metrics in balanced scorecard will help organization to measure the
performance and effectiveness of the work flow process. These three strategies gives way
to next set of questions on this that is what kind competency to be improved? And how
cycle time reduction can be done? To answer this question there will proper training
program will be given. In this balanced scorecard there will be another perspective that is
learning and growth. This perspective is common base for both the revenue growth
strategy and productivity strategy. Learning and growth three important metric they are
first is develop strategic skills this is achieved with help of proper on the job training.
Second will be Access to strategic information should ensure that all employees can
access to the common goals, financial status of the company then new deal. This helps
them to improve the knowledge about the work flow. Third will be alignment of personal
goals. Each employee in the company should have a goal this goal should be
communicated to the individual through training and development team in the company.
All these strategies lead to increase in employee productivity. This employee productivity
helps in improvement above mentioned strategies that is revenue growth and
productivity.
4.5 ACHIVING STRATEGIC ALIGNMENT: FROM TOP TO BOTTOM
Clarifying and
Translating the
Vision and Strategy
Communicating
Balanced Strategic feedback
and Linking
scorecard and learning System
Figure 4.10
There are three distinct mechanisms are used in this method they are
CHAPTER 5
5.1 SUMMARY: FINDINGS
Companies initially adopt the balanced scorecard for various reasons which include
clarifying and gaining consensus on the strategy, focusing organizational change
initiatives, and developing leadership capabilities at strategic business units and how
effectively they manage and coordinate with other business units. In Zenta there are five
business groups which have lack of communication between each other this will one
major reason why Zenta will go for balanced scorecard in future. The balanced scorecard
can be a cornerstone for any organization’s management system because it aligns and
supports some of the key process they are
• Communicate the strategy throughout the organization
• Align goals to all departments and employees
• Linking all the available strategies in the organization
• Aligns a new kind of performance management system
• It take cares both internal and external side of the organization
If an organization which is implemented balanced scorecard what to quick transition,
from vision to action plan mean they will feel the real excitement and gain of real value
of balanced scorecard because it mobilizes the system according to the new vision and
make quick change in the performance system which will suit the new vision. So it will
become very comfortable and easier to change the entire management system in short
period.
5.3 CONCLUSION
Controlling is an extraneous task in any organization, as it is to include various
aspects of Business – like Client Management, Process Management, Support
Management etc. Hence, it is important to implement control measures systematically.
KAPLAN AND NORTAN came up with a tool which helps achieving this, which is
called “Balanced Scorecard”. All the process in an organization has to function in a
manner which achieves the organization objectives ultimately. “Balanced Scorecard” is
an effective tool to align this taking a “Top Bottom” approach
In Zenta, I have made an attempt to do a Quantitative study of how “Balanced
Scorecard” can be in built to the process and as a Performance Management tool. The
outcome has been very interesting & further scope can be explored.
CHAPTER 6
APPENDIX
BIBLIOGRAPHY
• The balanced scorecard “translating strategy into action” by Robert S. Kaplan and
David P. Norton
• www.balancedscorecard.org/.../AbouttheBalancedScorecard/.../Default.aspx -
• en.wikipedia.org/wiki/Balanced_scorecard
• http://management.energy.gov/documents/
• http://www.qsrinternational.com/