1. Executive Summary
Financial Performance
Implementation of a balanced scorecard enabled the South Division (SD) to achieve a
17.4% improvement in financial results over the North Division (ND). Within the SD,
differences in the quality of implementation affected the degree of success of each branch.
Implementation Differences
Higher Performing Branches Lower Performing Branches
clear and thorough regarding the inadequate in explaining why
Communication was…
purpose and use of the scorecard the scorecard was important
Scorecard development management in collaboration with
management only
was done by… employees
unrealistically difficult or far
reasonably attainable and fair for
Goals set were… too easy to attain and not equal
all employees
for all employees
both group and individual, and
not clearly defined or
Incentives were… included monetary and non-
nonexistent
monetary rewards
Recommendations
• Communication – clearly explain the purpose of the scorecard and help employees
understand how to achieve their goals.
• Scorecard development – allow employees to work with management to identify and
set the measures and goals used in the scorecard.
• Attainability/Equality of Goals – make sure goals are realistic and reachable for all
employees in the branch.
• Incentives – reward the group for the collective success of meeting branch goals as well
as individual recognition for high performing employees.

2. 03 May 2012
Case 2
Team 2
Case 2 - Balanced Scorecard Case B
(Team 2: Rima LeBlanc, Kelly Austin, Alan Bucciero, Steve Gotshall, & Kevin O’Neil)
Financial Performance
After one fiscal year of implementing a Balanced Score Card (BSC), the financial results for Tri-
Cities Bank support the use of a scorecard at all branches. Figure 1 shows a high-level
comparison of the financial performance changes between the North and South Divisions from
2000 to 2001 – a difference of 17.4%. It is clear from this summary graph that the South
Division had a much larger improvement in financial performance in 2001. Noting that the only
operational difference between the two divisions was the implementation of the Balanced Score
Card (BSC) management tool throughout the South Division, it is easy to see the benefit the BSC
had on the average financial performance.
Figure 1. Tri-Cities Bank Division comparison.
Figure 2 breaks the data in Figure 1 down to show the performance increases of each branch
within Tri-Cities Bank. The dotted line running down the middle of the graph divides the
branches by division. With the exception of branch E, this figure clearly shows the benefit the
branches in the south division received as a result of implementing the BSC. Although the north
division produced consistently positive returns across all branches, the potential for much larger
gains with the use of a BSC is evident in the results of branches A, C, and B.

3. 03 May 2012
Case 2
Team 2
Figure 2. Tri-Cities Bank Branch comparison.
Figure 3 focuses on a comparison of the large performance increases each branch within the
south division accomplished using the BSC in 2001. It can be seen that branch A achieved the
largest percentage increase in financial performance, while branch E showed the smallest
increase in financial performance. While all branches did show an increase in performance from
2000 to 2001, the results varied greatly. These differences can be correlated to the methods used
by management to implement and execute the BSC, and to how the program was received by the
branch employees. The implementation section discusses the lessons learned on BSC
implementation strategies
Figure 3. South Division branch comparison.

4. 03 May 2012
Case 2
Team 2
Implementation
After reviewing the financial performance results, the average benefit of using the BSC is clear.
However, the results of the BSC vary greatly depending on the method by which the system is
implemented and managed within an organization. The following sections discuss lessons
learned on four major factors contributing to the performance of the BSC in operation.
Communication
Management introduction and delivery of the BSC determined employee motivation,
participation, and willingness to meet or exceed expectations. Those branches that performed
well communicated clearly how a BSC would help employees and the branch measure progress
and growth. Managers that spent time explaining each goal and how to reach it engaged
employees in the process and experienced positive results. Managers that presented the BSC as a
tracking device found employees viewed it more as a micromanagement tool than a motivational
one. Pitching the scorecard only as a measure for competition created a negative impact on
branch performance. The success of the BSC begins with management’s ability to communicate
and implement a scorecard that employees can clearly understand and attain its objectives.
The management in branches A, C and D did a particularly good job communicating the purpose
and use of the BSC during implementation, and that was reflected in their high-performance
results. The management in branch E did a very poor job in communicating the BSC, which is
reflected in their lack of improvement in their financial performance.
Scorecard Development
After evaluating the data from each branch in the South Division, it is evident that there were
two main styles used to develop each scorecard. The branches either had their employees
involved in the scorecard development process or in the other case only had their manager
involved. The branches that opted to have their employees help with the BSC development
performed significantly better than those that chose to only allow the manager to develop it. For
example, Branch C and D did an excellent job in factoring in employee feedback when starting
the business scorecard, which made the employees feel more like a team. This teamwork
strategy seemed to create more synergy among the employees and helped lead to an overall
improvement in the bank's three main financial measures. Having the employees involved in
deciding what measures to include on the scorecards also helped the employees focus more on
their goals while some of the other branch's employees were unclear of what their specific goals
were.
The management in branches C and D did a particularly good job working with the branch
employees to develop the BSC during implementation, and that was reflected in their high-
performance results. The management in branch E did a very poor job in involving the
employees in the development of the BSC, which is reflected in their lack of improvement in
their financial performance.

5. 03 May 2012
Case 2
Team 2
Attainability/Equality of Goals
Employee expectations and constant feedback are directly correlated to a successful branch
scorecard. While every branch approached this differently, what seemed to work the best was
creating the goals as a team with employee feedback, allowing the employees to have a say in
both the goals and in the incentives that were attained in those goals. This allowed the
employees to see the goals of their fellow workers, and to understand that everyone had similar
difficulties. With public goals, the employees had concrete expectations of what was expected
on them on a daily, weekly, or quarterly basis. This created a competitive environment, but also
fostered group involvement to reach the common goals of the branch. Regular feedback from
the employees to management kept the BSC moving forward, while encouraging the competitive
nature of the goals. Timely recognition of individual goal completions kept the program visible
in the branch and encouraged participation. The feeling that the goals are challenging but are
ultimately attainable seems to sustain the participation of the employees in the BSC throughout
the year and helps ensure that the organization will strive to achieve high results.
The management in branches A, B, C and D did a particularly good job of establishing high, but
realistic, attainable goals during the BSC implementation, and that was reflected in their high-
performance results. The management in branch E did a very poor job of establishing
appropriate goals BSC, which is reflected in their lack of improvement in their financial
performance.
Incentives
Incentives offered to individuals and groups encourage success of the balanced scorecard.
Individuals were offered monthly cash bonuses if they met or exceeded the BSC expectations.
An additional cash reward was given quarterly to the employee who performed the best in his or
her branch. This created a sense of competition and focus among employees and helped them to
meet the BSC objectives. Performance also determined raises, year-end bonuses, and
promotions of employees of the branch. A group incentive included a branch party at the end of
a successful quarter. Some employees did not have a clear understanding of the incentives or
believed there simply were none. Branch managers continue to seek new and improved ways to
reward positive BSC performance. These incentives promote individual determination to meet
or exceed BSC expectation and teamwork among branch employees.
The management in branches A, B, C and D did a particularly good job of establishing an
appropriate incentive program during the BSC implementation, and that was reflected in their
high-performance results. The management in branch E did a very poor job of establishing
appropriate incentives for the BSC, which is reflected in their lack of improvement in their
financial performance.

6. 03 May 2012
Case 2
Team 2
Recommendations
After reviewing the results of a balanced scorecard from the Southern Division, successful
implementation of the BSC in the north division will depend on the level of attention
management gives to these four factors:
1. Communication – clearly explaining the purpose of the scorecard and helping employees
understand how to achieve their goals.
2. Scorecard development – allowing employees to work with management to identify and
set the measures and goals used in the scorecard.
3. Attainability/Equality of Goals – making sure goals are realistic and reachable for all
employees in the branch.
4. Incentives – rewarding the group for the collective success of meeting branch goals as
well as individual recognition for high performing employees.
By using these best practices in implementing the BSC management tool and following the
lessons learned, the North Division can expect to see a significant improvement in their future
financial performance.