The company I chose for the discussion of this assignment is Microsoft Company. Microsoft is one of the leading software developing companies in the world. The technology-based company was founded by Bill Gates. The company is located in the USA and has its headquarters in Redmond, Washington. The company deals with the development of software products, licenses, personal computers, consumer electronics, and other related services (Reuters, 2018). I chose this company because it’s one of the most extensive software and license developing companies in the world.
The contemporary management technique I chose for this assignment is the balanced scorecard. Balance scorecard is a management system which enables companies to translate strategies and visions into action. The method provides feedback on the internal business processes as well as external outcomes to improve the performance and results of the company. The technique views a company from four perspectives to align the business activities to the strategy as well as the vision of the company. This four perspectives include financial performance, customer satisfaction, internal business processes, and learning and innovation (Kaplan, 2001).
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Innovative companies such as Microsoft implement this strategy to manage their long-term plan as well as perform critical management processes. There are five elementary principles for a strategy-focused company utilising this contemporary management technique. This five principles as are summarised below (Watkins, 2013):
Translating strategy into operational terms through the use of balanced scorecards as well as strategy maps.
Align the company with the strategy through cascading the highest level scorecard to strategic corporate units, support units, and external partners.
Create strategy as every individual’s work with inventiveness to make strategic consciousness and by utilising individual scorecards with similar incentives.
Make strategy a repetitive practice by associating budgets to plan, employing a process for adapting and learning firm approach; and
Mobilize leadership for change to a strategic management system.
The Microsoft Company ought to implement the balanced scorecard technique, and through this, it can effectively increase its revenue, the loyalty of its brands, and also increased its shareholder value. The critical success factors mentioned above are used to measure or assess the success of an organisation or company such as Microsoft. Through the implementation of the balanced scorecard, Microsoft has demonstrated operational excellence, customer intimacy, and product leadership. The company has also limited the profitability as well as the growth of other competitors in the same industry such as Apple. Thus, the implantation of this strategy plays a significant role in influencing the success as well as the decisions of the individual company (Microsoft) as well as that of competitors (Isoraite, 2008).
Without strategic information as well strategic decisions, Microsoft is likely to stray away from its competitive course as well as make wrong product decisions, for instance, develop uncompetitive software or choose inefficient distribution and marketing method. However, through the implementation of the balanced scorecard, this can be avoided. As a result of its application, Microsoft can increase its revenue, product loyalty and expand its shareholders.
To sum up, the balanced scorecard is a very significant contemporary management technique as it converts a company’s strategy and vision into a complete set of performance indicators that offers a structure for evaluating its strategy as well as its management system. The technique is composed of four principles; financial performance, customer satisfaction, internal business processes, and learning and innovation. It allows for checking financial results and the capability of the organisation to source assets required for its development and increasing effectiveness, capacity to create value for current as well as upcoming customers.
Reference
Isoraite, M. (2008). The Balanced Scorecard Method: From Theory to Practice. [Online]. Available at: http://www3.mruni.eu/~int.economics/3nr/Isoraite.pdf . Accessed 28 th Aug 2018.
Kaplan, R. (2001). Putting the Balanced Scorecard to Work. [Online]. Available at: https://hbr.org/1993/09/putting-the-balanced-scorecard-to-work . Accessed 28 th Aug 2018.
Reuters. (2018). Microsoft Corp (MSFT.O). [Online]. Available at: https://www.reuters.com/finance/stocks/company-profile/MSFT.O . Accessed 28 th Aug 2018.
Watkins, G. (2013). Successful Step by Step Implementation of the Balanced Scorecard. [Online]. Available at: http://www.workinfo.org/index.php/articles/item/69-successful-step-by-step-implementation-of-the-balanced-scorecard . Accessed 28 th Aug 2018.
