Balanced scorecard implementation at Rang Dong plastic joint-stock company (RDP)

Tuan Trong Luu

doi:10.5539/ijbm.v5n7p126

Abstract

From the balanced scorecard (BSC) framework, which encourages the use of both financial and non-financial measures of performance, allowing the firm to pinpoint its strategic objectives via balancing four perspectives – financial, customers, internal business processes, and learning and growth – to measure firm performance (Kaplan and Norton, 1992; Kaplan and Norton, 1996), the paper sought to explore how balanced business scorecards were designed and to what extent of success they were implemented at Rang Dong Plastic Joint-Stock Company (RDP) in terms of its organizational structure and company philosophy.

Highlights

Performance measurement systems aim to "integrate organizational activities across various managerial levels and functions" (McNair et al, 1989)
The remainder of this paper reports on Rang Dong Plastic Joint-Stock Company’ attempts to devise a balanced scorecard from the author’s suggestion to Mr Ho Duc Lam, chairman of its board of directors
By concentrating on the aspects of the business which created value for customers and, by thoroughly re-appraising the company philosophy and incorporating this into the performance measurement system, Rang Dong Plastic Joint-Stock Company (RDP) was able to build a balanced business scorecard which acts as an effective means of communicating the strategy of the company throughout the whole organization

Summary

Introduction

Performance measurement systems aim to "integrate organizational activities across various managerial levels and functions" (McNair et al, 1989). The BSC provides a framework, which encourages the use of both financial and non-financial measures of performance, allowing the firm to pinpoint its strategic objectives via balancing four perspectives – financial, customers, internal business processes, and learning and growth – to measure firm performance (Kaplan and Norton, 1992; Kaplan and Norton, 1996b). Since its introduction in 1992, the BSC has featured in a wealth of academic and practitioner papers; writing on the BSC focuses on its application in large organizations, drawing on case examples such as Mobil and CIGNA (Kaplan & Norton, 1996b), ABB, Skandia, SKF and Halifax (Olve et al, 1999) – all multi billion Dollar companies. The following section will starts with a brief overview of the organizational context prior to presenting an analysis of the process whereby the scorecard was generated

Case Study

Findings

Concluding remarks