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Balance scorecard vs Traditional methods of performance evaluation: 

Balance scorecard vs Traditional methods of performance evaluation By Ashok kumar Balwinder singh

Balanced scorecard : 

Balanced scorecard The Balanced Scorecard ( BSC ) is a strategic Performance measurement tool - a semi-standard structured report, supported by proven design methods and automation tools, that can be used by managers to keep track of the execution of activities by the staff within their control and to monitor the consequences arising from these actions.

Characteristics : 

Characteristics The characteristic of the Balanced Scorecard and its derivatives is the presentation of a mixture of financial and non-financial measures each compared to a 'target' value within a single concise report. The report is not meant to be a replacement for traditional financial or operational reports but a succinct summary that captures the information most relevant to those reading it . It is the method by which this 'most relevant' information is determined that most differentiates the various versions of the tool in circulation . Balanced scorecards help in communicating the strategy formulated to all members of an organization by translating the strategy into a coherent and linked set of understandable and measurable operational targets. Subsequently, the managers and employees take actions, based on scorecards, to achieve firm’s strategy

The four perspectives: 

The four perspectives Financial : encourages the identification of a few relevant high-level financial measures. In particular, designers were encouraged to choose measures that helped inform the answer to the question "How do we look to shareholders?" Customer : encourages the identification of measures that answer the question "How do customers see us?" Internal Business Processes : encourages the identification of measures that answer the question "What must we excel at?" Learning and Growth : encourages the identification of measures that answer the question "Can we continue to improve and create value?

Traditional Methods of Performance Appraisal : 

Traditional Methods of Performance Appraisal ESSAY APPRAISAL METHOD STRAIGHT RANKING METHOD PAIRED COMPARISON CRITICAL INCIDENTS METHODS FIELD REVIEW CHECKLIST METHOD GRAPHIC RATING SCALE

PowerPoint Presentation: 

ESSAY APPRAISAL METHOD This traditional form of appraisal, also known as "Free Form method" involves a description of the performance of an employee by his superior. The description is an evaluation of the performance of any individual based on the facts and often includes examples and evidences to support the information. A major drawback of the method is the inseparability of the bias of the evaluator . STRAIGHT RANKING METHOD This is one of the oldest and simplest techniques of performance appraisal. In this method, the appraiser ranks the employees from the best to the poorest on the basis of their overall performance. It is quite useful for a comparative evaluation . PAIRED COMPARISON A better technique of comparison than the straight ranking method, this method compares each employee with all others in the group, one at a time. After all the comparisons on the basis of the overall comparisons, the employees are given the final rankings .

PowerPoint Presentation: 

CRITICAL INCIDENTS METHODS In this method of Performance appraisal , the evaluator rates the employee on the basis of critical events and how the employee behaved during those incidents. It includes both negative and positive points. The drawback of this method is that the supervisor has to note down the critical incidents and the employee behaviour as and when they occur . FIELD REVIEW In this method, a senior member of the HR department or a training officer discusses and interviews the supervisors to evaluate and rate their respective subordinates. A major drawback of this method is that it is a very time consuming method. But this method helps to reduce the superiors’ personal bias . CHECKLIST METHOD The rater is given a checklist of the descriptions of the behaviour of the employees on job. The checklist contains a list of statements on the basis of which the rater describes the on the job performance of the employees GRAPHIC RATING SCALE In this method, an employee’s quality and quantity of work is assessed in a graphic scale indicating different degrees of a particular trait. The factors taken into consideration include both the personal characteristics and characteristics related to the on the job performance of the employees. For example a trait like Job Knowledge may be judged on the range of average, above average, outstanding or unsatisfactory.

Comparison of Balanced score card method and traditional methods of performance evaluation: 

Comparison of Balanced score card method and traditional methods of performance evaluation

PowerPoint Presentation: 

Balanced scorecard method Traditional methods Focuses on other non-financial aspects of the business that allow it to not only focus on current financial results but also helps show how a business can create future value by strategic activities. Balanced Scorecard helps reduce the vast amount of information the company IT systems process into essentials. Traditional systems of performance analysis focus on financial measures alone and were too backward looking and internally focused. It generates vast amount of data that is difficult to manage.

PowerPoint Presentation: 

Balanced scorecard method Traditional methods Provides management with a comprehensive picture of business operations. More open channels of communications provides management with a narrow picture of business operations. Lack of communications

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