Effectiveness of the balanced scorecard in implementation of corporate strategy at CFC Life Assurance Ltd

Abstract

Most organizations find it hard turning strategy to reality. The Balanced scorecard (BSC) is a management system approach developed in the early 1990s by Kaplan and Norton. The BSC enables organizations to clarify their vision and strategy and translate them into actions. This study set out to establish the effectiveness of the BSC in implementation of corporate strategy at CFC Life Assurance Limited and to determine challenges faced by CFC Life Assurance Limited during implementation of the balanced scorecard approach.

To achieve the above objectives, primary data was collected through the use of an interview guide. Ten managers who were involved in formulation of strategies and implementation of the BSC were interviewed. It was established that the BSC was an objective oriented approach in achieving the goals of the organization. With the use of the BSC, employees were able to see how they fit in to the bigger picture in the whole organization that leads to success in all areas of the business.

The results that accrued from adopting the BSC were: improved employee motivation, improved performance measurement and improved customer service. This is consistent by the literature by Drury (2004) that the BSC approach provides a solution to the need for a comprehensive framework for translating the organization strategic goals in to a coherent set of performance measures by developing major goals which are then translated in to specific measures.

Among the challenges faced was achieving a common understanding of the BSC by all employees and cascading to the lower cadre employees. The study recommends that CFC Life Assurance Limited comes up with a system to monitor and evaluate the BSC effectiveness.