Liberty University Operations Management Discussion

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DISCUSSION THREAD 1 (JD)

Discussion Board: Balanced Scorecard

Key Concept Explanation

Robert Kaplan and David Norton first introduced the concept of the balanced scorecard in 1992. They conducted a year-long research project with 12 companies to develop the balanced scorecard, which gives managers a balanced presentation of both financial and operational measures of success (Kaplan & Norton, 1992). The balanced scorecard considers four perspectives on success. The perspectives are an internal business perspective, an innovation and learning perspective, a customer perspective, and a financial perspective. In my position in the military, I am not setting out to achieve financial goals. I oversee 5 other people with a specific operational function. Therefore, I chose to research the balanced scorecard in order to learn more about operational measures of success versus purely financial objectives.

Comparison

The balanced scorecard uses operational measures of success instead of antiquated methods that only measured financial objectives. It has been used as a tool to help organizations transform their business strategy into applicable performance measures to monitor business success (Meredith & Shafer, 2019). One of the keys to developing the balanced scorecard is creating a strategy map linking the causes and effects of strategy actions. There has been some debate over the years if those cause-and-effect relationships actually exist between the operational measures of the balanced scorecard method. In their research, Kober and Northcott (2020) established statistical evidence that cause-and-effect relationships do, in fact, exist in the balanced scorecard in the public sector.

The balanced scorecard tool has been widely adopted across businesses, industry, government, and non-profit organizations around the world. Some organizations have applied a balanced scorecard approach and expanded it to include a corporate social responsibility aspect (Hansen & Schaltegger, 2016). The balanced scorecard specializes in translating organizational strategy into actions that can be measured with key performance indicators (Balanced Scorecard Institute, 2020). The balanced scorecard uses a diversified set of indicators to reflect the strategy of the organization. Clearly defining a balanced set of objectives helps the business to meet the needs and expectations of the relevant stakeholders (Quesado et al, 2018). Some organizations have used cascading balanced scorecards to refine the organization-level scorecard for use at the team and even individual level (Balanced Scorecard Institute, 2020).

Article Summary

Robert Kaplan and David Norton wrote the definitive work that introduced the balanced scorecard in the 1992, and later revised it in 1996, in their article “The Balanced Scorecard-Measures That Drive Performance.” Kaplan and Norton assert that simply tracking financial accounting measures can be misleading when pursuing continuous improvement and innovation. In today’s modern business environment, businesses must track operational objectives as well in order to maintain a competitive edge in the market. Instead of just tracking return on investment or earnings per share, companies should track things like cycle times and defect rates. The balanced scorecard incorporates a financial perspective, as well as an internal business perspective, and innovation and learning perspective, and a customer perspective. This balanced scorecard can give management a succinct, overview of the organization’s total performance by focusing on a small group of the most critical metrics. Another advantage of the balanced scorecard method is that it prevents information overload by focusing on a small set of critical metrics. At the same time, the balanced scorecard causes top management executives to view the success of the business through various operational measures beyond just finances. Considering the customer perspective causes the organization to have to think about what kinds of metrics the customer cares about. The internal business perspective causes the organization to consider what they must excel at to meet customer expectations (Kaplan & Norton, 1992).

Biblical Integration

1st Peter 5:8 says to “be sober minded; be watchful” (New International Version, 2011). And that is the goal of the balanced scorecard: to be watchful over the success of an organization. Being sober minded is to think clearly about the objectives of the organization and a balanced scorecard is one tool that can help with that.

Proverbs 25:11 tells us, “A word fitly spoken is like apples of gold in a setting of silver” (New International Version, 2011). This verse is about clear communication, and the balanced scorecard clarifies and communicates the goals of the organization by translating the mission into actions.

“Commit to the Lord whatever you do, and he will establish your plans” Proverbs 16:3 (New International Version, 2011). Whatever business endeavor one undertakes, it should be committed to the Lord and one should work as if working for the Lord and not for men.

Application

The balanced scorecard is more applicable than ever before. It arose out of a need for a better way to measure organizational success beyond financial measures as stakeholder needs became more diversified and customers became more informed than ever before. According to a recent global study, the balanced scorecard was ranked 5th of the top ten most widely used management tools in the world (Balanced Scorecard Institute, 2020). It is used by more than half of all major companies in the U.S. Europe and Asia. The balanced scorecard tool is growing in other areas such as Africa and the middle east as well.

DISCUSSION THREAD 2 (JB)

Discussion Board: Project Life Cycle

Key Concept

There are many types of projects that can be undertaken in business. These projects have many different forms and scales. In order to better study project life cycles, it is easier to break them into a few common categories. Meredith and Shafer (2019) describe the stretched S and exponential project life cycles. The stretched S model is very common and shows a slow start during planning, which slowly picks up speed and then tapers off at the end as resources begin to be directed elsewhere. The exponential form, however, sees basically no return until the project is completed. It is critical to understand where in the project lifecycle output will be produced so as not to misunderstand performance compared to resources invested.

Comparison

There are many things to consider when studying the life cycle of a project. Measham et al. (2019) focus on the impact that supply chain can have on managing the project life cycle. A delay in the delivery of one component could delay the project output. That could make it appear that the project is no longer successful. It is important to remember, however, that the relationship between the percentage of inputs used and the percentage of output created is rarely linear. If one input component is missing for a time, other parts of production could still be continuing, allowing a sharp increase in production when that final input is received. Of course, this type of flexibility is dependent on the project at hand. This is why it is important for managers to understand their project life cycle, so they can tell the difference between a shuffling of steps and an actual impact to production. Galli (2020) describes just how important this understanding can be by pointing out that these projects are one of the key driving factors of the world economy. Conversely, the economic environment can impact the project as costs of supplies vary as does the demand for the product. It is critical, therefore, for managers to forecast these changes and time their projects accordingly. This type of planning can be quite involved. Zheng et al. (2021) lay out some of the many variables that can impact managing a project life cycle and it is a very complex issue.

Article Summary

Cha and Maytorena-Sanchez (2019) raise some very good points about the effective management of project life cycles. In the stretched S model, it is likely that managerial inputs will be mor necessary during the project initiation and project termination phases. These are the times when plans are being drawn up and decisions are being made about where resources should be allocated. Compare this with the project implementation phase, which hopefully can just be monitored and not require as much hands-on management. An effective manager will realize this difference in demand for attention during the project life cycle. This is important because many managers will have multiple projects at one time. It is important to prioritize and deconflict these projects so that each can be given the attention that it requires. This concept applies not only to managerial attention, but to other resources as well. For exponential projects, it may be more difficult for a manager to oversee multiple projects. This is because exponential projects require a more constant level of attention throughout the process. Furthermore, Cha and Maytorena-Sanchez (2019) define project management competences that can help to identify what type of oversight is required during which phase of the lifecycle. For some companies, it may be beneficial to have different leadership on projects during different life cycle phases according to what that leader’s strengths are.

Biblical Integration

Life cycle management is all about planning and understanding deviations from that plan. Proverbs 21:5 teaches, “The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty” (English Standard Version). Luke 14:28 says, “For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it” (ESV). It is also important to realize that, no matter how much planning and preparation is done, it is still important to trust in the Lord. Proverbs 16:9 says, “The heart of man plans his way, but the Lord establishes his steps” (ESV).

Application

Planning a life cycle of a project has many benefits. One of the main things is to understand the relationship between resources used and output produced. I have spent a great deal of time and money working on my MBA, and yet I have nothing tangible to show for it. If I expected to have eighty percent of the benefit because I have put in eighty percent of the time and effort, this endeavor would be deemed a failure and I would have to quit. Instead, I recognize that grad school is an exponential life cycle and only after completing one hundred percent of the work will the benefit of a degree be realized.