Abstract
The main purpose of this paper is to improve on the conceptual as well as the methodological aspects of BSC as a quantitative model by combining elements from traditional balanced scorecard (BSC) thinking with the Systems Thinking. This is done by combining short and long term aspects of measurements. The result is then used to build and construct a balanced scorecard model for strategic learning with the specific aim to maintain satisfied customers and motivated employees. Strategic planning, operational execution, feedback, and learning are some of the most important key features of any performance measurement model. This paper aims to address not only the conceptual domain related to BSC, that is, learning and system dynamics causality and feedback, but also the methodological domain concept of precision solved by differential equations. Our results show how a potential move from a static strategic vision map to a linked and dynamic understanding may be not fully realistic but very useful for learning purposes. The new knowledge obtained from the learning feedbacks fertilizes both decision discussion and decision-making and what may be required in order to move to the next level of BSC and system dynamics integration.
Highlights
The paper is a response to the increasing interest in using balanced scorecard (BSC) for decision making, for planning, and for strategic learning
The structural change setting will focus on two reaction parameters in the system, production lead time and finished inventory adjustment speed, whereas the initial state settings will deal with the levels of finished inventory and machine capacity, respectively
The model is formulated as a monthly model over a five-year period, which is seen as a normal strategic period for BSC [20, 99]
Summary
The paper is a response to the increasing interest in using BSC for decision making, for planning, and for strategic learning. We note increased interest in “fact-based-decisions” discussed through the concept of “business analytics” proposed by Davenport [9]. Several recommendations have been given for researchers to draw upon a broader set of theories and disciplines when developing and testing hypotheses about different phenomena [4, 10,11,12,13,14]. This would create what Merchant et al [13] call “the reduction of disciplinary parochialism.”
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