The application of balance scorecard as a strategic management tool at national bank of Kenya
The balance scorecard is a strategic management tool that is used in the alignment of individual goals and objectives to the overall strategy of an organization. As well as that it is used as a performance management tool. The BSC can be used by organizations to manage their strategy over their long run as well as implement strategies across their businesses. The focus of this study was the application of the balance scorecard as a strategic management tool at National Bank of Kenya. As a strategic management tool the balanced scorecard can assist organizations to focus, align and clarify their vision and strategy and to further translate the strategies into action. The study was set out to establish the extent of the adoption of the balance scorecard as a strategic management tool at National bank of Kenya. It was also set out to establish the challenges faced by the bank in the adoption of balance scorecard. The research design that the study adopted was the case study design. The study was conducted through an in depth interview of ten informants drawn from both the head quarters of National bank of Kenya as well as other branches in Kisumu and Nairobi, the interviewees were from the senior management group of the bank. The information that was given by the interviewees was then recorded in written form. The primary data was then analyzed through content analysis. Secondary data was obtained from the strategic plan of the organization, annual reports, meeting reports, various internet sources as well as the official website of the organization. The study established that NBK uses the BSC as a strategic management tool to help align key objectives to various departmental objectives. The BSC is used in each and every stage of the organization when adopting strategy from formulation, implementation and then evaluation and control. It was also established that as well as the numerous benefits of adopting the BSC there were several challenges linked to the same. Some of these challenges include formulation of departmental strategies that are linked to the corporate strategy of the bank. Inadequate skills and knowledge on the BSC, cultural change lead to a lot of confusion within the bank. Another challenge was having KPIs that are too difficult when appraising staff performance departmentally. All these challenges should be taken into consideration by any organization when adopting the BSC as a strategic management tool. The results of the study are consistent with other existing body of knowledge by various scholars in the field. Further research needs to be done to find out how the BSC can be used to influence change management in the organization. The study gave consistent results in comparison to other similar studies done in the country but the results varied with studies done in different countries due to the environment aspect. More research needs to be done to see how effective the balanced scorecard has been in strategic management in organization which involves strategy formulation, implementation and control in other companies in the banking industry in Kenya.