Business: The Balanced Scorecard and the Financial Perspective Analysis


Most companies rely on financial reporting systems for an indication of past performance. However, these systems provide little information about future performance. Therefore, to solve this problem, Kaplan and Norton (2005) have provided a solution using the balanced scorecard, BSC to allow companies to track the financial results while at the same time monitor progress in building growth capabilities. A balanced scorecard is essential in defining what the management means by performance measures as well as ascertaining whether the desired results have been achieved. As such, the balanced scorecard translates a company’s mission and vision statements into workable objectives and performance measures that are appraisable and quantifiable (MacKay, 2004).

Moreover, the balanced scorecard includes metrics in financial, customer value, internal business process, employee, and innovation performances (Hoque, 2012). Therefore, Cattaraugus County Rehabilitation Center did an effective job of implementing a balanced scorecard approach in a fashion that reflects their organizational mission and vision. The center did this by realizing that it needs a conducive environment using organizational culture, technology, and, workforce to achieve the operational goals. However, the center was faced with a challenge of convincing all the managers to accept the concept in addition to coming up with outcome measures for its consumers who have disabilities.


The Cattaraugus County Rehabilitation Center implemented a BSC in a bid to align itself with the overall strategic plan even though it lacked adequate readily available for the implementing the concept. It ensured that the BSC was aligned with the mission of improving the quality of life of the organization’s clients. As such, the center matched the importance of the consumer and financial perspectives at par as appropriate for a non-profit making organization. The organization also gathered more financial resources externally for although the internal processes were crucial in creating efficiencies without reducing the expenses. The Director sought the consensus of the top-level management on the chief objectives to help in mapping and linking the measures and objectives to the desired deliverables.

Consumer Perspective

The consumer perspective works to determine the needs of clients thereby assisting in devising an appropriate value for application to the end-user and thereby satisfying their needs. This entails measuring the quality of an organization’s product and service quality as well as taking into account the perceived value (Hoque, 2012). Therefore, customer measures are taken to indicate the future performance of an organization, measured by the customer satisfaction shown after they are offered innovative products at the right time. ReHabilitation Center thus sought to enhance the customer perspective by improving service access, closing the gap of unmet services, improving support to its clients’ families, in addition to improving services in the natural environment. Further, the Cattaraugus County Rehabilitation Center chose to improve its customers’ quality of life by providing optimal independence in addition to using client inputs for the development of individualized plans thereby providing the clients with work opportunities.

Financial Perspective

The financial perspective assists in determining whether the set strategies have achieved the role of shareholder wealth maximization. However, the financial measure is historical and does not provide a clear picture of the present situation of an organization and its future performance prospects. On the other hand, the organization’s profits cannot be ignored since they provide a clear picture about whether an organization would pay dividends to its owners in the future. The ReHabilitation Center thus worked to boost its productivity and increase the revenue. This was done by increasing the revenue sources through maximization of the prior funding as well as discretionary funds and obtaining new non-MA revenues (Martello, Watson & Fischer, 2008). These objectives were indicated by the total debt ratio, current ratio, and cash flow of the private revenues to total revenues. The balanced budget and net income also served as an indicator of the same. The average cost per person by living arrangement, the efficiency ratio, and the type of service were used to indicate the efficient utilization of resources.

Operational Perspective

The operational perspective is important in determining the major business processes that develop a measure that ensure well-running of the processes and deliver a company’s products to the clients. This is crucial in supporting the perspectives and thus if well-implemented, better quality and smaller lead-times are attained thereby generating greater profit margins (Martello et al., 2008). The measures available include efficiency and quality measures, service measures, cost reductions, lead-time, and innovation rates.

The Cattaraugus County ReHabilitation Center thereby improved its relations with clients and staff accessibility by implementing the operational perspective. This was done through an improvement of productivity, a development of inclusive information systems which are indicated by the number of reports produced from automated data. The number of trend reports related to goals is an indication of the center’s willingness to establish measures and analyze data on outcomes to continuously improve services. CSR was used to create a positive image thereby ensuring a safe and secure environment for consumers, employees, and visitors (Martello et al., 2008).

Learning Perspective

This perspective is used to determine the ability of an organization to innovate and improve on a pro-rata basis. It aims to improve the human resources and other intangible assets of an organization (Hoque, 2012). An organization, through a balanced scorecard, seeks to support value creation thereby defining its human and developmental requirements to increase the shareholder value and as such innovate and boost its growth. An organization increases its profits and ensures greater customer satisfaction with corporate growth by improving its internal processes. Therefore, the Cattaraugus County ReHabilitation Center realized that the workforce, technology and environment needed an overhaul in order to achieve its set operational goals (Martello et al., 2008).

The management increased staff competencies as shown by the percentage of staff successfully completing training and the percentage of the staff meeting. They also developed recognition programs for employees as indicated by the number of employee recognition programs. The center provided personal growth opportunities to its employees and used technology to support the provision of offside services and thus improved strategic alignment and communication throughout the agency as shown by the percentage of departments with strategic plans supporting goals (Martello et al., 2008).


Cattaraugus County Rehabilitation Center has thus shown that it did an effective job of implementing a balanced scorecard approach reminiscent of its organizational mission and vision. The center took care of the consumer perspective to boost the quality of life of its clients by closing the gaps in unmet services thereby improving access to services, supporting the families of the individuals with disabilities as well as improving services in the natural environments. The center also gave the consumers maximum independence by providing opportunities for participation in community activities hence sustaining relationships.

Financially, the center attempted to raise revenues and productivity through sourcing for new revenues from non-MA revenues, discretionary funds, and outside funding. This is in addition to operating at a breakeven level and utilizing the available resources in a better way. Further, the center has attempted to develop an information system thereby creating a safe and secure environment for its stakeholders (MacKay, 2004). By identifying and implementing new service opportunities for its clients, the center grew its revenue base. Moreover, the center strengthened its workforce, organizational culture, and employed technology to ensure that it achieves its operational goals, which is part and parcel of the balanced scorecard.


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