全球商業經營管理學報 平衡計分卡：非營利組織的觀點 第一期 page13-22 ISSN：2076-9474 平衡計分卡：非營利組織的觀點 The Balanced Scorecard : the Nonprofit Organization Perspective 12陳順宇 陳麗如 摘 要 平衡計分卡的觀念最早是在1992年由Kaplan 和Norton導入企業界，它是一項複雜的績效評估系統也是一項策略管理工具。如何衡量組織的績效及運用有效的策略，一直是企業管理者在追求成功時的一項挑戰。近年來財務績效評估被批評為一單一指標並且是根據過去歷史資料而來，無法預測未來成功與否。而平衡計分卡是從四大構面來評估組織的績效，分別是財務構面、顧客構面、學習成長構面與內部流程構面。平衡計分卡的目標是為了平衡財務與非財務以及過去與未來的績效評估工具，使得企業在競爭的環境中能快速的反應。平衡計分卡能幫助企業發展更佳的策略目標並且越過私人企業與公共事業的藩籬，許多非營利事業單位也可利用平衡計分卡創造卓越的績效與效率。非營利組織也要滿足股東的營運要求，雖然平衡計分卡大部分運用在營利事業，教育機構尚未大量引進此觀念。教育單位須面臨的複雜工作，績效也較難評估，但運用平衡計分卡較易找到其影響組織績效的驅動因子，進而增加績效。本研究探討平衡計分卡的文獻並將運用至非營利組織。 關鍵詞：平衡計分卡、績效卓越、非營利組織 ABSTRACT The balanced Scorecard (BSC), first introduced by Kaplan and Norton in 1992, is described as a comprehensive performance measurement system as well as a strategic management tool. Measuring organizational success and implementing effective strategies for future success represent continuous challenges for managers. In recent years, financial measures are blamed for that they are one-dimensional and they are backward-looking in the record. Financial measures can’t forecast the performance of future. The Balanced Scorecard model requires corporations to evaluate their organizational performance form four different perspectives - financial, customers, internal businesses, and learning and growth. The aim of the BSC is to formulate operational objectives and financial and non-financial performance. It enables firms to achieve a rapid reactive change to fit with the change in the competitive environment. The BSC can help organizations develop better strategic goals and objectives and migrate across the private-public boundary to form a key part of attempts to improve performance management, efficiency and accountability in many nonprofit sectors. Nonprofit organizations also face demands to be accountable to their stakeholders. Although the concept of the BSC has been widely adopted and used in the business sector, the education sector apparently has not embraced the BSC concept widely. The complex nature and activities of university present particular challenges for performance management. Nonprofit organization engages in highly differentiated, non-routine activities, the outcomes of which are difficult to measure. The purpose of this research is to review the balanced scorecard literature relating to strategic implementation and evaluate the BSC techniques have been applied in the nonprofit sectors. Key words:Balanced Scorecard, Performance Excellence, Nonprofit Organization 1 The Professor of Department of Business Administration, Chang Jung Christian University, Email:sychen@ 2 A Student of Graduate School of Business and Operations Management, Chang Jung Christian University, Email:lijuchen@ 13
全球商業經營管理學報 第一期 university. A measurement process is necessary and 1. Introduction the BSC is the effective measurement tool for In the increased competition and high education institute (Chen et al., 2009). unpredictable business environment, organizations have to seek new ways to evaluate performance. It 2. The development of BSC is necessary to develop managerial navigation and measurement tools that guide and assess The Balanced Scorecard (BSC) is a organizational performance. The environment has performance measurement system as well as a experienced a dramatic change from industrial to a strategic management tool introduced by Kaplan knowledge-based ascendancy which is complex, and Norton (Kaplan and Norton, 1992, 1993). The rapid, unstable, being networked, and ambiguity. authors proposed that financial measures alone were With the increasing pressure to achieve performance not sufficient to measure performance. The BSC improvement, the need to implement highly addresses shortcoming of traditional performance effective efficient and integrated management measurement systems that relied solely on financial systems is continuously increasing. There has been measures. Other factors such as competence and an emphasis on understanding how performance is knowledge, customer focus and operational created within the firm. To understand what drives efficiency and innovation were missing from performance, managers must have in place traditional financial reporting. Kaplan and Norton performance measurement systems designed to introduced three additional measurement categories capture information on all aspects of the business. that cover non-financial aspects. The BSC puts strategy and vision at the center of the system. It The company’s success for tomorrow depends establishes goals and assumes employees will adopt on its ability today of intangible assets such as their behavior to achieve the goals.. The BSC customer relation, internal business process and translates the vision and strategy of a business unit employee learning. Financial measures describe into objectives and measures in four different areas: only a small part of the firm performance. Traditional financial measures, like ROI and EPS, 1. The customer perspective: how the company can give misleading signals. As a result, managers wishes to be viewed by its customers. The want a balanced presentation of both financial and indicators are such as customer satisfaction, new operational measures. One performance customer retention, new customer acquisition, measurement tool – the balanced scorecard (BSC) customer response time, market share and has broad appeal. The concept of balanced customer profitability. scorecard (BSC) was described as a performance 2. The internal business process perspective: in measurement system capable of providing senior which processes the company must do in order to management with fast but comprehensive view of satisfy it shareholders and customers. The key business. The BSC helps determine what is measures include product design, product important for existence and sustainability by development, post-sale service, manufacturing addressing multiple layers of the firm. The BSC efficiency and quality. We must excel at appraises organizational effectiveness, not only the maximizing on-time delivery and minimizing perspective of shareholder value, but also on the defect rates. organization’s ability to learn and adopt dynamic 3. The organizational learning and growth internal change. Approximately 50% of Fortune perspective: which improvements the company 1,000 companies in North American use a version must achieve to implement its vision. The key of the BSC, according to a recent survey by Bain & measures include the ability of employees, Co. (Missroon, 1999). information systems, and organizational procedures to manage the business and adapt to In international competition higher education change. institutes enhance their competitiveness and 4. The financial perspective: how the company improve the education quality to meet international wishes to be viewed by its shareholders. The academic trend (Chen et al., 2009). Many indicators include profitability measures such as universities have looked up methods from industry operating income, earnings per share, and adopt some type of total quality management return-on-capital-employed and sales growth. system to create competitiveness (Vazzana, et al., 1997). To promote university education quality, Kaplan and Norton (1992) developed their measurement performance indicators are needed. balanced scorecard model for use by These indicators could ensure the performance of profit-maximizing organization. The first three operating and improve the disadvantage of dimensions translate into improved financial 14
平衡計分卡：非營利組織的觀點 outcomes (Kaplan and Norton, 1996). The (performance drivers) indicators, and of financial “balance” of the scorecard is reflected in it mix of and non-financial measures. The framework of BSC lagging (outcome measure) and leading is presented in figure 1. Financial333 internal Customer Vision Learning Figure 1 The framework of Balanced ScorecardThe traditional performance measures focus as an evaluation of the organization performance, solely on financial metrics such as return on but also to be used as a strategic management tool. investment or net earnings (Lynch and Cross, 1991). The BSC can be used to focus attention on the most The Balanced Scorecard (BSC) model requires critical resources and induce consistency of decision corporations to evaluate their organizational making and resource allocation (Neely et al., 1995). performance form four different It also aligns the organization to the strategy by perspectives—financial, customers, internal focusing employees on their role in accomplishing businesses, and learning and growth. (Kaplan and the company mission. The BSC drives measures Norton, 1992, 1993) For certain firms, non-financial from the organization’s mission, thereby aligning measures such as development copyright, or goals to strategy. improving customer loyalty, are better indicators of The BSC has evolved and morphed from future performance. The performance measures measurement tool to strategic change framework, links to BSC give to the management a fast but and most recently to a tool to measure the readiness comprehensive view of the business. Critics of the of intangible value drivers (Marr and Adams, 2004). BSC argue that the four perspectives do not The BSC can approach several strategic represent the interests of all stakeholders (Kenny, management objectives including focus on reward, 2003). The key criticisms of the BSC are that the promote the objectives, ensure investment of time perspectives are inflexible and constraining, the and resource. The BSC enables a firm to utilize cause and effect relationships may not hold. Too existing project metrics as aligned performance many measures may affect managerial judgment goals based on each project’s mission and vision and the BSC is not a credible management solution goals (Moser, 2005).The strategic vision for (Norreklit, 2003). achieving the company’s financial goals is The performance measurement tools can help articulated throughout the scorecard development businesses to evaluate their resource allocation process. process in order to determine how resources can be The BSC has had a considerable impact on better managed and distributed to the appropriate organizations worldwide. (Frigo, 2002) A US survey channels. The organization can build their key estimates that 60% of Fortune 1000 firms have strategic objectives through developing the four experimented with the concept (Silk, 1998). The perspectives of BSC. The BSC can not only be used 15
全球商業經營管理學報 第一期 BSC has gained wide acceptance, particularly in the educational institutions for reinforcement of the US. A survey of its members by the American importance of managing rather than just monitoring Institute of Public Accountants and Maisel (2001) performance. Sutherland (2000) reported the revealed that 43 percent were utilizing the technique. balanced scorecard approach to assess its academic This is not only to its intrinsic value to businesses, program and planning process. The BSC has been a but also because the concept has been aggressively useful tool in both the public and private sectors. marketed. This tool creates tangible value from (Bolivar, Rodriguez and Hernandez, 2006) measurement and implies taking vague notions of The BSC model presents a tool for translating strategy and turning these into executable plans. an organization’s mission into more tangible measurable goals, actions and performance 3. The BSC in the non-profit measures. The BSC approach involves identifying organization key components of operations, setting goals for them, and finding ways to measure progress In order to understand how longer-term, towards their achievement. This instrument non-financial objectives translate into value, Kaplan transforms strategy into operational plans and and Norton (2000, 2004) suggest visually mapping strategic measures that enable the organization to relationships between strategic objective and their decide whether or not a project is operating measures into a strategy map. A strategy map on-strategy. One of the strengths of BSC is that it contains outcome measures and performance drivers forces management teams to explore the belief and linked together in a cause-and- effect diagram. assumption underpinning their strategy. Another of Speckbacher et al. (2003) found that about half of the strengths is that its appearance is so agreeably companies using a BSC also use causal maps. No simple. It suggests that with only a few longer do managers have to work their way through well-balanced numbers one can monitor the piles of statistics, but can focus on monitoring some performance of an entire company. It also can serve 15-20 key indicators instead. as a bridge between different field, both financial Cullen, Joyee, Hassall, and Broadbent (2003) and non-financial ones. proposed that a balanced scorecard be used in 16
平衡計分卡：非營利組織的觀點 Table 1 Comparison the measures between education and business and growth perspective and growth perspective Innovation and suggestion rate; educational Innovation and suggestion rate; learning; programs completed; on-the-job performance on-the-job performance improvements; improvements; training rates; collaboration and collaboration and teamwork; knowledge-sharing teamwork; knowledge-sharing across work across work functions; employee well-being and functions; employee well-being and satisfaction. satisfaction. perspective perspective Capacity to improve student performance, Productivity, cycle time, supplier and partner student development, education climate, performance, key measures of accomplishment indicators of responsiveness to student’s needs, of organizational strategy and action plans. key measures of accomplishment of organizational strategy and action plans. perspective perspective Results should be based on a variety of Customer satisfaction measurements about assessment methods, should reflect the specific product and service feature, delivery, organization’s overall mission and improvement relationships, and transactions that bear upon the objectives and represent student learning. customers’ future actions. perspective perspective Administration expenditures per student, tuition Return on investment, asset use, operating and fee level, cost per academic credit, resources margins, profitability, liquidity, growth, value redirected to education from other areas, added per employee. scholarship growth. The vision of case university is to be the best The study provides information to managers university in Taiwan. The methods are to offer high who are contemplating implementing any quality programs and conduct valued research and performance measurement system based on multiple support regional economic development. To prepare measures, such as the BSC. The BSC is also used in students to become managers and leaders who will the nonprofit sectors in hospitals and universities. add value to their organizations. The BSC strategy For example, Bridgeport Hospital in Bridgeport, map uses a generic architecture to describe each Connecticut has used a BSC for three years to strategy. Each measure is rooted in a chain of provide a framework to measure performance in a cause-and-effect logic that connects the desired complex and changing medical environment. At outcomes from the strategy with the drivers that will Bridgeport Hospital, the BSC created a common lead to the strategic outcomes. The strategy map language among the administrative and medical illustrates how intangible assets are transformed staff leadership. It also helped the hospital to focus into tangible customer and financial outcomes. on patient satisfaction, and link goals to employee performance appraisal (Gumbus, Lyons, Bellhouse, Although originally designed to be used by 2002). Figure 2 is presented the causal chain of for-profit companies, the method is flexible enough business. for all types of organizations, including universities. 17
全球商業經營管理學報 第一期 Economic Value Added Lagging Financial Accounts Operating Receivable Expenses Customer Satisfaction Customers On-time Delivery Shorter Cycle Lower Time Rework Internal Business Process Quality Learning Employee Employee And Skill Suggestions Growth Employee Morale Leading Figure 2 Causal Chain for businessand brainstorm the SWOT of university. 4. The Strategy Map of Case University To understand value drivers, the management The case organization is a middle private must have in place performance measurement university and established in 1968. For forty years, systems designed to capture information on all it has overcome all possible difficulties and has aspects of the business by brain storming, not just developed firmly and steadily. It is combining its the financial results. When the management is faced legacy of leadership in innovation-based education with multiple tasks, their behavior will differ with an expanding emphasis on the pursuit of depending on whether the performance technology ability. There are about eight thousand measurement system adopts a financial measure or students and four hundred teachers. There are many includes mixed measures. If the goal of the challenges for management such as students organization is to increase shareholder wealth but decreasing rapidly and competition increasing. The managers focus on short-term profit without regard basic problem is that the graduated high school for customer satisfaction. Customer satisfaction is a students are less than the entrance opportunities of leading indicator of profitability, due to increased university. The education sector would like to costs required to achieve a high level of customer develop good honor, it uses measures from all satisfaction. Multiple measures provide better category not just short-term financial measures. In information on changes in the economy and the first activity, teachers analyze their university 18
平衡計分卡：非營利組織的觀點 competition. the destination and the actions that must be taken to reach that destination. Operational control system is The vision of case university is to be a best established to ensure that the managers and university. They put the vision at the center of BSC employees acted in accordance with strategic plan. system. The principal must have a clear picture of Figure 3 is presented the strategy map of case the strategy. The theory is top-down driven control so senior executives have a clear vision of Strategy Best University Financial Improve Foundation Assets Revenue Growth Productivity Increase Grant Revenue Tuition Reveune Cost Per Pupil Campus Cost Customer Student Retention Computer Skill Professional SkillJob Placement Salary of Graduate Internal Service Efficiency Distinctive Distance effectivenesdesign and program learning delivery opportunities Learning Employee Orientation and Satisfaction Performance pay Training Morale Health environment Figure 3 The Strategy Map for Case UniversityThe learning and growth perspective has a both financial and non-financial measure versus larger effect for firms using only financial solely relying on financial measure. This is perspective. The standardized effects provide consistent with the early research. These results evidence that non-financial outcome measures have suggest that the internal perspective and customer a greater effect on profits when the firms emphasize perspective are mediator variables between financial 19
全球商業經營管理學報 第一期 perspective and learning perspective. The process of 5. Conclusion establishing a vision, communicating with all The BSC concept helpful to arrive at a list of participants is a feedback process. The case financial and non-financial performance measures, university has received rewards, including golden which managers saw as the most important ones. medals at international invention exhibition and However, they were uncertain if they were really the grants from ministry of education. The operational right measures to monitor. The BSC model is useful steps include: but does not represent a holistic approach to 1. To implement the BSC come from the top down: managing service based organizations. The BSC is a The top management has used the BSC to align long-term change strategy. To be successful, the vision and focus employees on how they fit into BSC must be driven from the top of the the picture, and educate them on what drives the organization and dependent on a well-developed organization. By communicating organization organizational structure, an understanding of the strategy, The BSC works as a vehicle to take key role of the customer, and ownership by top and financial indicators and promote organizational middle management. learning and continuous improvement. Increasing competition and globalization, 2. To understand what drives present performance is organization integrated strategic management tools the basis for determining how to achieve future that link performance measurement to results. All employees keep organization’s organizational management. The BSC has become a strategic policies and vision in mind. The popular concept for performance measurement. It operating principle is to determine factors that are focuses attention of management on only a few critical for achieving the goals. performance measures and bridges different 3. To translate the goal and vision to operational functional areas as it includes both financial and target: Top-level scorecard criteria are non-financial measure. The bridging to be determined for lower-level scorecard criteria. Top performed can be both hierarchical and horizontal. management develops the BSC by setting annual The BSC model improves performance efficiency operational target that links short-term actions so and effectiveness, depending on the level of employees understand how their day-to-day perceived value and acceptance. The BSC can be activities. Target must be specific, measurable, adapted for use in public-sector organizations ambitious, realistic, and time-phased. Targets are simply by rearranging the scorecard to place set based on the gap between present customers or constituents at the top of the hierarchy. performance and desired performance for the two years in the future. A review of the literature identifies five main 4. To implement the tool: The tool can help areas of criticism relating to the BSC. Using management focus on critical factors for their particularly Norreklit’s (2000, 2003) criticisms of success and align hundreds of indicators. We use the BSC’s assumptions, this research gained views a map to derive customer critical success factors on the number and titles of perspectives in the BSC; by analyzing customer survey data. Internal the existence and understanding of cause-and-effect indicators are derived by determining how relationships; whether or not the BSC was perceived process improvements can deliver customer as a strategic control model; the number of requirement. Employee learning indicators are performance measures and perceptions of the ability identified by determining what human resources to judge performance based on those measures; and are required. the credibility and effectiveness of the BSC as a management solution. The major benefits of the study achieved BSC can be summarized as follows: Critics of the BSC argue that the four perspectives do not represent the interests of all 1. The university registration rate reached above 87 stakeholders. The suppliers, competitors, per cent in the past three years since 2006. governments, local communities and the 2. The student satisfaction reached 82 per cent. environment are received little attention. Many 3. The university’s mission and vision were companies have redesigned the original announced clearly, thus students and staff achieve four-perspective layout. For example, Volvo uses the goal effectively. one long-term and one short-term scorecard (Olve et 4. The budget system is controlled well and al., 2003). Malmi (2001) showed that it is common encourages excellent performance. for Swedish companies to add a fifth BSC 5. The e-learning programs are excellent. perspective, in order to recognize employee 20
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