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Bank of Montreal's Balanced Scorecard

Essay by   •  May 15, 2012  •  Essay  •  343 Words (2 Pages)  •  2,677 Views

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1) What are the strengths and weaknesses of a balanced scorecard approach to performance appraisal ?

Answer:

The strengths of a balanced scorecard are:

- It can help the bank employees to see more clearly as to how his or her performance ties into the overall performance of the bank.

- It will help guide the employees in determining the success factor of their objectives, which are their (4) four goals.

- Balanced scorecard, BMO's strategic action implemented will match the desired outcomes of their (4) four goals

The weaknesses of a balanced scorecard are:

- It can be costly to implement a balanced scorecard system

- Balanced scorecard gives the bank's employees an overall view of the four areas for concern in business growth and development but the four areas did not paint the whole picture. The financial information included on the scorecard is limited. Instead, to be successfully implemented, the balanced scorecard must be part of a bigger strategy for company growth that includes meticulous accounting methods.

- The scorecard does not provide ideas to improve the performance. The balanced scorecard acts as a fact sheet, but it requires that the executives to analyze the facts and come up with an evaluation and a strategy. The scorecard will not solve all of the company's problems and it must be combined with a larger overall strategy to achieve its potential benefits.

2) Do you think that it is fair to base the bonus paid to BMO's CEO on the four indexes comprising the firm's balanced scorecard?

Answer:

Yes. The balanced scorecard is a very difficult and time-consuming system to execute. It acts as a fact sheet and it will not work if the executives (CEO) didn't come up with plans and strategies to make it work so they can achieve the desire outcome and goals for BMO.

3) Do you believe that a balanced scorecard approach would be more effective for the administrative or for the development purposes of appraisal discussed in this chapter ?

Answer:

The balanced scorecard approach would be more effective for administrative development purposes because it's originally rooted from human resources management

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