StudyCorgi Business & Economics

Futura Company’s Balanced Scorecard Approach

Introduction

Futura is a company that deals with extrusion of aluminum and manufacture of different products for its market. It is a company whose main aim, just like any other business, is to increase its profits, improve its performance and also ensures customer satisfaction every day (Vonderembse & White, 1996).

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The company chose to utilize the Balanced Scorecard (BSC) so as to approach the achievement of its goals in a professional and well-proven perspective. The BSC has different facets that have been proven to aid companies in achievement of their goals. These facets include the financial, customer perspective, internal perspective and the learning, innovation and growth facets. All these facets are important to observe in any successful organization. However, every company chooses one of the facets and pays more attention to it while still focusing on the other facets.

“The Futura company has focused on the learning, innovation and growth facet of organizational goal” (Niven, 2009, p.1). The reason for this is because the Johnson, the company director and president, believes that it is the labor resources in a company that count the most as they determine the utility of the rest of the resources in the company. Her main aim is to ensure the development of the labor resources in the company. Her goal is to make sure the company sustains great people, not working machines. Therefore, she believes that every employee in the company should be a part of the success process and hence should be fully integrated into all the affairs and strategies aimed at ensuring the process of achievement of organizational goals (Gumbus & Johnson, 2003).

Analysis

Futura as an organization utilizes different measures in BSC so as to determine how effective the strategy adopted for the learning and growth of the employees is in the company. One of the measures the company employs in this perspective is the measurement of the turnover which has been on a good trend and has enabled the company to obtain and retain its employees while at the same time reducing on the costs of production. This measure has also enabled the company attract more talented and skilled labor hence it has been able to acquire some of the most skilled and talented employees in the market. This has helped the company in ensuring that the process for innovation, learning and growth is imposed only on the best talents available (Kaplan & Norton, 2004).

Another measure the company uses is the measure of employee performance, commitment and output in relation to the working environment and the available resources and tools that help in improvement of work. The company is fully devoted in increasing the available resources for its employees and improving their working conditions, a factor that in return increases the productivity and performance of the employees.

The company even undertakes surveys at different levels in order to determine its current situation as far as workplace initiatives are concerned. These surveys are aimed at determining the attitudes of the employees towards the different benefits awarded to the employees and hence determine which ones are the most important to implement at any given time. They also determine the success of the already implemented initiatives to ensure more improved working places (Niven, 2009).

Further, the company measures the different initiatives that are aimed at improving the well-being of the employees at their workplaces. One of the factors considered is the interactions between the leadership of the company and the employees. The management is supposed to interact in a healthy manner with the employees and also to recognize and improve any talents available in the employees. It should also integrate every employee in the affairs of the company especially in the growth and success strategies and processes.

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In addition, the company lays measures to determine the extent and effectiveness of the talent and skill development strategies within the labor resources in the company. These strategies usually include the in-job trainings and certification initiatives that are aimed at improvement of the knowledge and skills in the employees, a factor that contributes directly to the innovation, learning and growth process in the company.

Another measure employed by the company is the determination of the level and quality of the customer services offered to the customers of the company. The company determines how effectively each employee contributes to customer services and then considers retention of the best talents in that aspect even as it obtains more employees whose vision is consistent with the company’s requirements for better customer services (Baye, 2006).

The company goes ahead and puts a measure of the financial aspect associated to each of its employees. The company hence determines the actual cost of retaining an individual employee as well as the financial benefits associated to him/her. This way, the company is able to improve on the financial benefits associated to each of the employees at an individual level and collectively improves on the productivity of the labor resources within the company.

Finally, the company utilizes a measure of the internal operations of the company, a factor that determines how well the company utilizes its available opportunities and the set strategies in delivery of services and quality products. Through determining the improvement of safety in the workplace, the company measures the returns realized so as to determine how well it is able to realize its innovation, learning and growth initiatives (Gumbus & Johnson, 2003).

Evaluation

The implementation of the BSC approach in Futura was carried out in a professional and sensible manner. The approach had its risks especially since it is one method that is bound to only give returns in the long-run rather than immediately, since the innovation, learning and growth process takes long to be effective and requires a lot of patience. However, the company was able to focus on the long-term returns of the process instead of the immediate benefits and hence was able to realize more benefits from the whole process (Kaplan & Norton, 2004).

As indicated by the company’s success, for example when it was able to attain “a 50% increase in revenue without adding personnel from 1996 to 1999” (Gumbus & Johnson, 2003. p.1), a factor that is rare in most of the companies, the use of the BSC approach chosen by the company had its benefits.

Further, being named one of the best companies in the state as far as being family-friendly is concerned and also being named the top private employer in the state are factors that are bound to even attract more talents into the company and hence ensure increased performance as well as quality products, factors that consequently increase the market share of the company and result to increased revenue. (Vonderembse & White, 1996, p. 59)

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Hence, the approach is very effective for the company and should be adopted by other organizations with an aim of realizing long-term and sustainable benefits from their labor force especially in terms of productivity, performance, commitment and collectively increased quality of products and services.

Conclusions

The BSC approach used by Futura included a focus on the labor resources within the company. The company believed that improvement of the employees in terms of provision of better working conditions and more benefits as well as incentives would influence their productivity and performance and overall result to improvement of the rest of the facets of the BSC approaches (Baye, 2006).

“The implementation of the different strategies and measures at the company adequately captured the full dimensions of the learning and growth perspectives within the company” (Gumbus & Johnson, 2003, p.1). The strategies were aimed at ensuring that employees were integrated fully into the learning and growth process.

For example, the company had one of its aims as ‘putting people first’ and went ahead to apply surveys at different time frames so as to determine the main requirements of the labor resources so as to improve them. Further, the company implemented different initiatives to ensure proper learning and skill improvement in the employees. All these factors properly reflected the main purpose of the adoption of the BSC approach (Gumbus & Johnson, 2003).

The perfectness of the implementation of the BSC approach was more revealed by the benefits realized at the end. The returns realized by the company by the same amount of employees increased tremendously within the period 1996-1999 and even after that.

References

Baye, M. (2006). Managerial economics and Business strategy (5th ed.). London: Willey.

Gumbus, A., & Johnson, D. (2003). The balanced Scorecard at Futura industries. Web.

Kaplan, S., & Norton, D. (2004). Measuring the strategic readiness of intangible assets. Web.

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Niven, P. (2009). Learning and Growth perspective: EPM Review. Web.

Vonderembse, A., & White, P. (1996). Operations Management: Concepts, Methods, and Strategies (3rd ed.). Minneapolis: West Publishing Company.

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StudyCorgi. (2020, December 13). Futura Company's Balanced Scorecard Approach. Retrieved from https://studycorgi.com/futura-companys-balanced-scorecard-approach/

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"Futura Company's Balanced Scorecard Approach." StudyCorgi, 13 Dec. 2020, studycorgi.com/futura-companys-balanced-scorecard-approach/.

1. StudyCorgi. "Futura Company's Balanced Scorecard Approach." December 13, 2020. https://studycorgi.com/futura-companys-balanced-scorecard-approach/.


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StudyCorgi. "Futura Company's Balanced Scorecard Approach." December 13, 2020. https://studycorgi.com/futura-companys-balanced-scorecard-approach/.

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StudyCorgi. 2020. "Futura Company's Balanced Scorecard Approach." December 13, 2020. https://studycorgi.com/futura-companys-balanced-scorecard-approach/.

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StudyCorgi. (2020) 'Futura Company's Balanced Scorecard Approach'. 13 December.

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