Bank of Montrial Analysis
The root problem of Bank of Montreal was how they could focus each and every employee on the success of the company. BMO needed to meet the needs of the 4 shareholders: BMO shareholders, customers, employees, and communities. Case Questions Identify the strengths and weaknesses of a balanced scorecard approach to performance appraisal? The first strength of the BSC approach is a focus on the company’s strategic direction.
A BSC approach helps management communicate the company’s mission y linking performance measures to its mission and strategy.
The balance scoreboard not only gives you a better idea of your workforce, but also creates better customer service for the customers involved. The balanced scorecard makes the CEO’s of these companies make sure that their businesses are running accurately and if it is not, it will reflect in their pay. Thus, a good balanced scorecard identifies many cause-and-effect relationships within the business and helps employees and managers appreciate the roles of employee and task as well as the importance of ach result to the overall corporate effort.
The balanced scorecard method is a form of checks and balances for a company to ensure that the needs of all four shareholders are met.
Although there are many strengths to the balanced scorecard method, there are a few weaknesses. First, the balanced scorecard method might be too broad to truly judge performance. I believe that if a company deliberately tries to collect and report certain data measures then their report will most likely achieve good results. Second, I feel that BMO’s balanced scorecard puts too much emphasis on the company internally.
I think that BMO should first focus on their SWOT analysis (strengths, weaknesses, opportunities, and threats) externally and then set internal performance measures that coincide with those goals.
Question 2: Do you think it’s fair to base the bonus paid to BMO’s CEO on the four indexes comprising the firm’s balanced scorecard? Yes, I believe that it is fair to base the bonuses paid to the CEO on the four indexes on the balanced scorecard. If the firm had a high rating at the end of the year it eant that the company had met and accomplished the four goals.
This also means the CEO did a great Job of communicating his or her values down the corporate ladder. Therefore, the CEO should be rewarded on his performance. A firm is only as good as its worst employee.
When BMO received a high rating it shows that the CEO demonstrated strong managerial and communication skills. Lastly, this initiative will force company CEO’s to become more involved in all the aspects of the company. The balanced scorecard makes the CEO’s of these companies make sure that their
Question 3: Do you believe that a balanced scorecard approach would be more effective for the administrative or for the developmental purposes of appraisal discussed in this chapter? First, I believe that a balanced scorecard approach is effective for both the administration and for developmental purposes of appraisal. On the other hand, the balanced scorecard approach seems to be more effective for the developmental purposes of appraisal. Identifying needs and concerns the firm’s employees far outweighs the administrative purposes.
The appraisal process provides managers nd employees with the opportunity to discuss ways to build on their strengths, eliminate potential weaknesses, identify problems, and set new goals for achieving high performance.
(Book) This is important because it is more focused on the whole firm rather on broad aspects of it. I believe that a successful company works from the ground up. Therefore, if all the employees start to improve then the whole company will improve. References References should be on a separate reference page with citations listed and formatted per APA guidelines.