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LEO, based on the balanced system of performance indicators

Author: ZhaoXueMei
Tutor: ShaoYunFei
School: University of Electronic Science and Technology
Course: Business Administration
Keywords: performance index system balanced scorecard strategy maps
CLC: F272
Type: Master's thesis
Year: 2011
Downloads: 219
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Abstract

The research and application of the Balanced Scorecard have continued for more than 20 years overseas and there are many successful cases for reference. The theory of Balanced Scorecard has been introduced into China for a very short time, thereby national small and medium-sized enterprises has less successful cases in application. The huge number of small and medium-sized enterprises are important for national economic development and cannot be ignored. The huge problem we face is how to increase whole competitiveness of national small and medium-sized enterprises, improve overall business performance and make sustainable development possible in the growing global competition.Performance management is very important for enterprises to perfect modern enterprises’operation mechanisms and important for guaranteeing realization of sustainable development. The key point of performance management for companies is the design of performance index system. As a member of the great army of small and medium-sized enterprises, like most small and medium-sized enterprises, LEO Company has characteristics of unclear strategy, nonstandard management, uneven personnel qualities, etc. In this case, what is worth of study is which method of performance management should be taken.LEO Company is an object of study in this text. During studying, I took a combined method of theory analysis, analyzing history information, questionnaire survey, research interviewing, and comparison analysis. This text introduces the state of theory study and application at home and abroad first and provides the topic of study and application on building company performance index systems on the basis of the Balanced Scorecard, in combination with the current state of the LEO Company’s performance index system and based on analyzing characteristics, advantages and disadvantages of the Balanced Scorecard. Afterwards a decomposition is performed by layers by steps of company-level performance index system, department-level performance index system and personnel-level performance index system, on the basis of the clear thought of managing LEO Company based on the performance index system involving the Balanced Scorecard so as to build the performance index system of the LEO Company. Therein the building of the company-level performance index system follows the steps of determining the company’s strategic objective , using the strategic themes to plan the strategy, describing the strategic map, decomposing the strategy into specific indexes and target values, and forming the company’s Balanced Scorecard finally; the building of the department-level performance index system follows the steps of decomposing the company’s performance index, combining the decomposed indexes with a department’s strategic map to build the department’s performance index system, and forming the department’s Balanced Scorecard finally; at last the department’s performance indexes are assigned to every position, a Competency Model is built for every position, the capability of the personnel on this position is estimated to find differences so as to form the individual Balanced Scorecard. The last part of this text analyses the problems in the application of the Balanced Scorecard based performance index system of LEO Company and provides relevant measures, which lays the solid foundation for the actual implementation of LEO Company.This test aims at designing a strategy-oriented performance index system for LEO Company and combines the company’s strategic objective with personnel behaviors organically, improve performances of the personnel and organization and enhance the enterprise’s competiveness so as to make positive contribution to the further development of the enterprise. In the meantime LEO Company is also one member of the family of national small and medium-sized enterprises and has certain typical problems and difficulties faced in implementing the Balanced Scorecard. I hope this case can have enlightening effects and give advices in the design of the performance index systems of other small and medium-sized enterprises in some level.

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