DESCRIPTION OF THE PROJECT/BUSINESS
Dell Computer Corporation was founded in 1984 by the then nineteen-year-old Michael Dell. The vision of the Michael Dell for the company is to be able to sell computers directly to customers decreasing the cost to consumers by eliminating the chain of retailers. In 1987, the company changed its name to Dell Computer Corporation. In 2003, the company name was officially changed to Dell Inc. to show the change experienced by the company as a supplier of diverse technology products and services. The company was expanding its products while at the same time expanding its markets. Dell was effectively developing and marketing its products to reach unprecedented sales, congruent to the growth of the company is its increased prominence in relation to the industry and the global market. The project plan will have to address the developing of integrated measurement system and balanced scorecard focusing computer related business companies in lieu of Dell business.
The designing as well as developing of measurement systems in the process of the balanced scorecards will help the computer industry to discover and integrate ample resources for product and services growth and stability within the global market and will put in precise factors that can be reflected in the four perspective elements found in the balanced scorecard integration process. Thus, the Balanced Scorecard approach retains measures of financial performance of Dell within their operations in lieu to such outcome on business drivers as it relates to the business strategies within the computer industry. Clearly, strategies for creating value shifted from managing tangible assets to knowledge based strategies that create and deploy an organization’s intangible assets as Dell have strong customer relationships and has always touching on developing innovative products and services with the skills and knowledge of the workforce, the information technology that supports the workforce and linkages to valued customers and suppliers in business climate that encourages innovation and improvement.
It can be that these computer companies do not really have adequate and concise measurement systems and do not directly apply the appropriateness of the balanced scorecard in their business structures as there can be emphasis on the operation efficiency and technology process for products and services sales realizations. The need for these companies to value their intangible assets and the determining of goal strategy and balancing assets as the process within the project are to transform the potential value of business assets into products and services that have tangible value as measurement systems through Balanced Scorecard describes how intangible assets get mobilized and combined with intangible and tangible assets to create differentiating customer-value propositions and superior financial outcomes.
BALANCED SCORECARD ANALYSIS
First, there is the need to understand and identify such perspectives found in the balanced scorecard as it can provide framework for organizing strategic objectives into perspectives as needed by Dell:
Financial – the strategy for growth, profitability and risk viewed from the perspective of the shareholder
Customer – the strategy for creating value and differentiation from the perspective of the customer
Internal Business Processes – the strategic priorities for various business processes that create customer and shareholder satisfaction
Learning and Growth – the priorities to create a climate that supports organizational change, innovation, and growth
It is crucial for the computer related companies to acquire maximum level for development of general framework for describing and implementing strategy that we believe can be as useful as the traditional framework of income statement, balance sheet and statement of cash flows for financial planning and reporting as it is logical and comprehensive architecture for describing strategy as there specifies the critical elements and their linkages towards better applied strategy. The objectives for growth and productivity to enhance shareholder value, market and account share, acquisition, and retention of targeted customers where profitable growth will occur. The need for value propositions that would lead customers to do business with the company, innovation and excellence in products, services, and processes that deliver the value proposition to targeted customer segments, promote operational improvements, and meet community expectations and regulatory requirements and with Balanced Scorecard, organizations create a common and understandable point of reference for all organizational units and employees respectively.
Financial Perspective
The application of revenue growth strategy as there build the can possibly supply and retail ways with good revenue from novel markets, products and customers and that there can be increase in computer sales to existing customers by deepening relationships with possible customers as there can be cross-selling multiple products and services and offering complete solutions to shareholder and supplier conflicts along the way. The imperative for Dell to use amicably the productivity strategy in improving cost structure and the utilization of assets as needed to support stable business operations in the market.
Customer Perspective
The core of the business strategy is the customer-value proposition, which describes the unique mix of product, price, service, relationship and image that a company offers as to how Dell differentiates itself from competitors to attract, retain and deepen relationships with the targeted customers.
The importance of these computer related companies to differentiate such value proposition by selecting among operational excellence as sustainable strategies are based on excelling at one of the three while maintaining threshold standards, a company knows which classes and types of customers to target. There has to be identification of Dell’s intended outcomes from delivering diverse value proposal that will satisfy their customers and will outcome to customer loyalty and satisfaction of the products and services they offer.
Internal Process Perspective
There must achieve the differentiated value proposition for customers and the productivity improvements for the financial objectives as it can possibly choose to measure the companies internal business processes by focusing only on the cost and quality of business market operations. There has to encounter great difficulty implementing growth strategies when primary measurements emphasize process improvements and not enhancing customer relationships and the generation of returns from the internal processes.
Learning and Growth Perspective
For learning an\d growth perspective, Dell managers will have to define the employee capabilities and skills, technology and corporate climate needed to support Dell strategy. The objectives are to amicably enable computer companies to align its human resources and information technology with the strategic requirements from its critical internal business processes, differentiated value proposition and customer relationships. The value of Dell’s executive team will be crucial as they have to identify and remedy gaps in the strategies being implemented in such levels of the organization. Dell should have adequate investment in those areas for long term success. Together, the perspectives provide a balanced view of the present and future performance of the business. It is important for Dell business to apply certain steps in fostering their measurement systems reflecting a better business performance from within the Balanced Scorecard such as the following:
Step 1: Define the Measurement Architecture
Dell must imply as well as integrate good design process in recognizing business dimensions and provide frameworks to guide the Executive Team in thinking about certain strategy. There are frameworks that describe the strategy and represent the foundation on which a complex design is based such as Dell can apply strong product design patterns in terms of such computer parts as there enhances Dell’s manufacturing as well as packaging strategies of the computer products and other amenities.
Step 2: Build Consensus around Strategic Objectives
To achieve this goal, each Dell Executive is interviewed individually to capture the implicit and explicit strategies for the business. These personal visions are then synthesized into feedback that is reviewed at an executive workshop and be able to discuss unresolved issues.
Step 3: Select and Design Measures for the balanced scorecard
Dell will then, select proper measures to track the achievement of the objectives as there must focus on the development of measures for a subset of the objectives, finalizing the wording of objectives and searching for measures appropriate for tracking objectives to function mode and with conformity on Dell’s strategic measures then, Dell measurement system design are to be completed.
Step 4: Develop the Implementation Plan
For a Balanced Scorecard measurement system to create value, it must be integrated into the management system of the organization. The final step of the process entails primary tasks for Dell to integrate: identifying the current practices in various management processes, evaluating opportunities for integrating the Balanced Scorecard into the management process, developing an implementation plan. The step reviews the client’s approach to data reporting and review, management meetings and decision-making, strategic learning, strategic communication, personal objective setting and planning and budgeting.
For Dell to be successful, balance is necessary for efficient and effective business achievement in maximizing computer industry potential. Dell’s performance measurement systems must achieve a balance, which supports progress against non-determined purpose, without sub-optimization. By requiring strategic planning and a linking of Dell program activities and performance goals to their budget, decision making and confidence in Dell performance are to control market operations. Dell financial performance measures indicated whether Dell’s strategy, implementation and execution are contributing to bottom-line improvement and shows results of strategic choices made in perspectives and the ability to deliver maximum value to customers.
Dell’s application of the balanced scorecard is to manage the organisation in critical accomplishments:
- alignment of strategy with key performance objectives at each levels of the organisation
- more effective measurement and management of business performance against plan
- strategic feedback and an organisation-wide communication platform
Example of Balanced Scorecard Framework initiating performance measurement
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As the perspectives designed to balance Dell’s internal and external business process for aligning good performance for success in future and the implementing of balanced performance measurement system can have effects on Dell’s business like for instance, deciding what the key drivers of performance in business, the refocusing and stimulating activity on the business drivers as well as drawing attention to goals and targets in creating culture of achievement. Gaps can arise between any of the segments. A gap between Dell vision and culture segments would revolve around such issues as the provision of clear direction by the leadership and beg questions as to whether the vision was sufficiently compelling and inspiring to the organization’s stakeholders. Similarly, a gap between the vision and measures segments would be concerned with learning to measure issues such as translating the vision into appropriate goals, objectives and measures and the use of measurement systems like, balanced scorecard. The gaps visible for Dell business would raise questions such as whether the measures accurately reflected the organization’s strategic goals and objectives in a balanced and effective way. Finally, gaps that arise between the measures and Dell corporate culture would be concerned with measuring to learn issues such as customer product-service feedbacks as well as learning and change.
The social perspective demands broad acceptance from Dell stakeholders and covers psychological conditioning, chartering and coaching of measurement and executive teams, exploratory analysis and the search for meaning, matching of measures to reward and other organizational systems, restructuring of performance reviews and personal change. Dell culture is changing as helpful to have knowledge of the organization’s change states and where it and especially those involved with crafting the measurement system of business progress and it is vital to assess Dell management inclination to work together as a group – team and the team role profiles can be utilized to facilitate dialogue about attitudes and behaviors. Dell must work on affective domain that calls for the use of consulting roles such as reflective observer, facilitator and challenger. Similarly, the measurement system are to be used to give utility business unit managers assistance during budgeting to ensure that targets were consistent with corporate goals and plausible in terms of the implied productivity levels. Putting measurement into the service of those who wanted to learn and do better, rather than use it for external control will close the measures-culture gap.
PROJECT DEVELOPMENT
Moreover, it is imperative and critical for Dell in such solution mechanisms to use and realize strategy map framework that will integrate the value of such perspectives from within Dell’s Balanced Scorecard concept as emphasized in illustration below.
Example of Mapping Balanced Scorecard
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The strategy map concept with the Balanced Scorecard, offers a new way to manage information-capital development and deployment. By shifting the focus away from evaluating information-capital performance by cost and reliability, the approach considers a company’s strategic alignment for example, measuring how information capital contributes to the company’s strategic objectives and especially to the differentiating processes identified in the internal perspective of the Strategy Map. The financial perspective describes the tangible outcomes of the strategy in traditional financial terms, measures like shareholder value, profitability, revenue growth and cost per unit are the outcomes that indicate whether the organization’s strategy is succeeding or failing. The customer perspective defines the value proposition for targeted customers. If customers value consistent quality and timely delivery, systems and processes that produce and deliver quality products and services are highly valuable to the organization. The financial and customer perspectives describe the desired outcomes of the strategy. For example, the increase of Dell’s internal research development investments and reengineer its product-development processes so that it can develop high-performance, innovative products for its customers. The learning and growth perspective identifies the intangible assets that are most important to the strategy as alignment of the perspectives to value creation for focused and consistent strategy.
Process design
The performance measurement system design principles are must be used by Dell in constructing good solution procedure for Dell performance measurement system such as:
Phase 1: Required measures for Dell products
Phase 2: Dell’s cost-benefit analysis
Phase 3: Purpose for Dell measurement system
Phase 4: Comprehensive Dell monitoring
Phase 5: Detailed Dell operations management design
Phase 6: Integration of Dell Business Drivers
Phase 7: Environmental Considerations
Phase 8: Ongoing balanced scorecards maintenance
BENEFITS
The aim of the process design phase was to establish a practical performance measurement system design process, building on the best of academic theory and industrial practice, which could subsequently be tested through live application. Furthermore, the benefits involve developing and reviewing different levels of Dell as business situation changes as well as effective mechanism for reviewing and revising targets and standards and include a process for developing individual measures as performance and circumstances change and agree with changes in Dell’s competitive environment or strategic direction and be used to challenge the strategic assumptions. Dell initially applied a traditional assembly line method in its production plants. Production in an assembly line requires different workers to be assigned with a single task constituting the different tasks involved in making a computer. To ensure quality and prevent defective computers from reaching customers, Dell has a company-wide quality control team or defect team and a quality assurance system. At the end of the assembly line, there is a quality control or defect team to test the assembled computer to ensure that the computer unit works and complies with all the requirements of the customer.
The recognition of bundling as a selling point for customers prompted Dell to provide spare parts including training to service providers so that technical support integrates hardware, software and service-provider repair needs of customers as Dell does not include brand equity in the determination of price to decrease the overall cost of its products. Dell offered custom-built computers, which imply that the company provides customers with the option to choose parts and accessories that the buyer really needs. In scorecard, the value proposition in customer perspective processes in internal perspective and the learning and growth perspective components of the scorecard define how fundamentals to strategy work as outcomes as the strategy is expected to achieve.
RISK ANALYSIS
The design of a performance measurement system is cognitive exercise, translating views of customer and other stakeholder needs into business objectives and appropriate performance measures. Dell implementing performance measurement system redistributes access to information which can be seen as threatening to the managers whose power base can be altered and that resistance to performance measurement is being observed. In completing the measurement system, risk assessment action plan described the specifications and steps to be taken in order to achieve the measurement levels.
The risk plan will include people responsible for reporting to strengthen performance measurement implementation within the organisation and to promote Dell benchmarking as such issues can be:
- buildings, land and equipment
- review quality monitoring
- continue to improve communication and industrial relations
- support and enable the interim strategy
- implement changes as the estate is developed
- agree and commence implementation of the strategy
- secure resources for capital improvement
The risks associated with project facility activities were defined as risks that were significant to the fulfilment of the organisation’s objectives. The control assurance standards reflect key areas where significant risks can be found and which could pose a threat to fulfilling the project objectives as there needs to have the identification of certain areas as it is important for the business organization to critically meet the standards of their balance scorecard application as the risks to be aware of are the following:
- management of business cycle
- fire safety management measures
- managing business services
- health and safety
- controlling contractors
- waste management
- information management
- technology and security
The fundamental analysis of risks in process is the effective involvement of people and functions within the organization through the application of self-assessment techniques to ensure that objectives are met and risks are properly controlled. The indicators was used to provide real focus, which could be cascaded to departmental level. Dell regular reporting of measures is necessary to keep the directorate on track and to take corrective action rather than having to wait until after the event to realise that things had not gone according to plan and Dell must achieve such points:
- customers/stakeholders’ needs and critical success factors were identified
- relationships with customers established and developed
- regular sampling of customer satisfaction and analysis of the results via key performance indicators
- service level agreements established and monitored where appropriate using key performance indicators and the achievement of environment assessment
The Dell team needs to identify process and metrics owners at the right levels and establish process management teams with representatives from the critical functions that impact the performance of the measure. The strategy of each business unit is a vital input to ensure that goals are realistic and align customer and business needs. In this phase, the leadership team needs to define priorities and establish smart goals that support critical business objectives. Based on the specifics of the situation, Dell should develop an integrated deployment plan that effectively leverages the internal resources and minimizes the risk of a false start. The lack of an integrated approach and plan is the most common failure in deploying a measurement system. Success is function of quality of Dell solutions and the acceptance by those who are expected to manage with the system and to those involved in designing measurement systems through scorecards will require alterations in the way Dell management is at best performance.
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