The Use of Balanced Score Card in Strategy Implementation by Quoted Companies in Nairobi Stock Exchange

Abstract

The current study evaluated the extent of use of the BSC as a model of choice for implementing and controlling strategy implementation among quoted companies at the Nairobi Stock Exchange. The study further evaluated the use of other models of strategy implementation and the perceived benefits contribution or effects of the model used to successful strategy implementation. The model used was also explored to determine the kind of organization structure various organizations had adopted, the performance measurement used to align the whole organization towards organization strategy. The data used in this paper was derived from some of the listed companies at the Nairobi stock exchange. The data was collected through the survey of senior managers of these companies through the use of a questionnaire. Descriptive statistics were used to present data and qualitative analysis was conducted to give meaning to the results. While there was some evidence of the use of BSC as a model of strategy implementations among quoted companies, there was no clear cut evidence that indicate companies followed to the letter the prescription of the model. The use of the BSC model among the quoted companies was found to be over 30%. However, various aspects of the BSC were substituted with conventional methods. Such areas of contrasts were found in the organization structure, measurement systems and management style. Furthermore, other models like Mckinsey 7-a model is also widely used in strategy implementation and from the analysis of the opinions of the mangers indicated that it borrows heavily from the BSC model. It also became clear that, none of the models could be said to more superior in achieving successful strategies but at the same time BSC was gaining popularity in Kenya’s the corporate world. Implications for the study is that on an effective model of strategy implementation is that regardless of the model chosen, then a structured system change to suit the strategy must be set, which should be a product of employee and top managers working together in setting the company’s strategic goals and objectives. These include the call for inclusion of employees in the formulation of corporate strategies using the bottom up approach and not the other way round.