Project Essay Example | Topics and Well Written Essays - 2000 words - 1

Project - Essay Example But in Balanced Scorecard the performance of an organization is looked into from a broader angle which spans over perspectives like: Financial, Customer, Internal business process, Learning and growth. This is done to integrate the various complexities in the operating environment of a modern-day firm and so that the along with the financial model other factors which have crucial effects on the firm are taken into account. This tool evaluates performance of an organization and provides a framework for guidance. This system is used by organizations, private, governmental and non-profit to examine their performance in relation to their strategic objectives. Using the balanced Scorecard system, it is possible to measure and evaluate the process which is responsible for present and future value creation. This also acts as a guiding framework for managerial decision making in context of areas to be focused upon and resources to be put into in order to create value. Analysis through this system brings forth the ‘value drivers’ in an organization (Balance Scorecard basics, 2009; Kaplan R.S. and Norton D.P., 1996). The main angles or points of discussion for the organization under the ‘customer perspective’ are identification of their target customers and also their won value proposition which would attract the customers. Identification of the value proposition is crucial because otherwise the organization would surely loose focus. Value propositions might emanate from: Operational excellence- These kinds of organizations get their value proposition from excellence and primary focus only on their operations and generally offer no-frill products or services. Example: EasyJet the European low-cost airline. Leadership through product- These firms depend on constant innovation and research to deliver better products to their customers. They become product leaders and lead the way in the market by always striving to and delivering

Adopting a simple profit-maximising perspective ..... can have Essay

Adopting a simple profit-maximising perspective ..... can have positive impacts for a firm ..... Discuss - Essay Example Business owners or the management are deemed to focus on maximizing profit in the short-run. Adopting simple profit optimization perspective can have positive results on a firm. This study will explore this assertion with a view to examine the positive impacts of profit optimization. Consideration will also be given to other views that suggest other perspectives that managerial decisions should consider. In today’s market, optimization of profits has gained a wider approach encompassing the consideration of uncertainty of time and value of money. This has added to the initial approach of firm theory arguing that the long-term goal of a firm is to maximize its value. Value of a firm is deemed as the present value, which is given by the expected cash flows. For simplicity, the expected cash flows are equated to profit and the present value is thus given as the value of all the profits or the cash flows, which is discounted at the selected interest rate (Keown, 2003, p. 5). Discounting is done to incorporate the uncertainty of time and value of money in the future. This study will explore the profit optimization perspective and its positive impacts, constraints faced by managerial decisions in their pursuit to optimize profits as well as the best perspective that managers should hold in the management of a firm. Profit optimization is a short-run process that involves determining of price and output levels that gives the highest returns in form of profit. As mentioned by Hirschey (2008, p. 38), the level of activity that maximizes profit in a firm is given at the point where marginal revenue (MR) and the marginal cost (MC) are equal such that any further generation of revenue results offsets cost. A simple focus on profit maximization implies that a firm is simply focused on making profits and the resources are utilized with the sole aim of getting the highest level of profits