The necessity of the study
The Balanced Scorecard, developed by Norton and Kaplan in 1990, is a performance measurement model that translates an organization's vision and strategy into specific objectives and metrics This system evaluates work performance across four key areas: finance, customer, internal business processes, and learning and growth By implementing this measurement framework, managers can effectively communicate with employees and stakeholders about performance expectations, aligning individual and departmental behaviors toward shared strategic goals Furthermore, the Balanced Scorecard facilitates the development of key performance indicators essential for managing and assessing employee performance Notably, a 2014 Bain & Company survey revealed that over half of the Fortune 1000 companies have utilized the Balanced Scorecard model since its inception in 1996.
After 30 years of renovation and integration, Vietnam's economy has achieved significant milestones, with per capita income increasing from $438 in 1986 to $2,200 in 2016, and an anticipated rise to $3,000 by 2020 This economic growth has led to higher living standards and an increased demand for housing and resorts, creating both market opportunities and competitive challenges for companies in architectural, interior, and construction design consultancy To thrive in this evolving market, businesses must develop effective strategies to gain competitive advantages TTT Corporation, established in 1992, stands out as a leader in design, construction, interior decoration, furniture manufacturing, and turnkey project execution for hotels, resorts, high-end apartments, and offices The year 2016 marked a pivotal moment for TTT Corporation, prompting a reassessment of its business strategies to align with new market demands, necessitating a clear vision and the establishment of key performance indicators for each department.
The urgent need for TTT Corporation to implement the balanced scorecard model is emphasized, as it aims to translate new visions and strategies into actionable goals and key performance indicators Drawing from my knowledge and experiences within the Corporation, I have selected the topic "Application of the Balanced Scorecard Model to Establish a Measurement System of Key Performance Indicators at TTT Corporation" for my master's thesis.
Overview of both global and domestic study on the Balanced Score Card (BSC)
The Balanced Scorecard (BSC) - is a modern strategic measurement and planning system, first introduced by R.Kaplan and D.Norton of Harvard Business School in
Since its introduction in 1992, the Balanced Scorecard (BSC) has garnered significant attention from managers and researchers worldwide, being utilized by over half of the Fortune 1000 companies since 1996 and recognized by the Harvard Business Review as one of the 75 most influential ideas of the 20th century According to Vietnam Report's January 2009 analysis, 7% of the 500 largest enterprises in Vietnam had implemented the BSC, while 36% were planning to do so, indicating a positive trend toward modernizing corporate governance and management practices This shift reflects Vietnamese enterprises' commitment to integrating modern management methodologies, enhancing their competitiveness in the global market.
Numerous studies have explored the use of card balance in enhancing the Balanced Scorecard (BSC) within strategic management The BSC serves three fundamental functions, with its application in strategic management being paramount Since the inception of the BSC model, significant research initiatives have emerged, highlighting its practical applications and effectiveness in driving strategic outcomes.
The Balanced Scorecard (BSC) is crucial for effective strategic management, emphasizing the importance of strategy implementation over mere strategy development Many leaders tend to focus excessively on crafting strategies, neglecting the execution phase, which results in unproductive outcomes Research has begun to explore the factors influencing the application of BSC in enterprises and its potential to address strategic management challenges Additionally, BSC plays a vital role in integrating organizational control mechanisms and operational management systems, linking them to successful strategic management While BSC alone may not be a miraculous solution, it offers a structured roadmap for organizations to transition from their current state to their desired future, equipping teams with the necessary tools for success.
The Balanced Scorecard (BSC) made its entry into Vietnam in the 2000s, gaining recognition in various workshops focused on business administration models Subsequently, both foreign and domestic consulting firms, including Deloitte and MCG, acknowledged the model's potential and initiated investments in training and consulting services to promote its implementation.
Several companies in Vietnam, including FPT Corporation, Kinh Do Company, Phu Thai Group, and Garni, have begun to adopt this model; however, the outcomes have not met initial expectations and remain below desired levels.
According to the author's research, the current studies in this field are limited in scope, primarily focusing on individual companies and presenting findings through essays, dissertations, and scientific papers The research results predominantly remain confined to a narrow range of investigation.
Doctoral thesis in Business & Management by Tran Quoc Viet (2012): In May
In 2012, Dr Tran Quoc Viet successfully defended his doctoral thesis on "Factors Affecting the Acceptance of the Balanced Scorecard Model in Strategic Management in Vietnamese Enterprises" at the National Economics University The research employed qualitative methods, including in-depth interviews, alongside quantitative analysis through the collection of survey questionnaires.
A study involving 206 Vietnamese enterprises examined the factors influencing the acceptance of the Balanced Scorecard (BSC) in strategic management The research introduced a new scale for measuring the "BSC acceptance level in strategy management," which encompasses three key dimensions: (1) the application of BSC concepts, (2) the extensive use of BSC functions, and (3) the integration of information technology to enhance BSC efficiency This new scale is found to be more applicable to Vietnamese enterprises compared to previous research scales.
The study identified six key factors influencing the acceptance of the Balanced Scorecard (BSC) in strategic management within Vietnam's transitioning economy These factors include: (1) the active involvement of senior leadership, (2) the degree of focus on strategic objectives, (3) the authority of the finance department, and (4) the implementation of standardized processes.
(5) internal communications and (6) market dynamics - products The impact level of each factor is different and has been determined specifically In which, there are
Two factors negatively impact the Balanced Scorecard (BSC) approach: centralization and systematization, while four other factors contribute positively These findings pave the way for further research on the implementation of BSC in countries that are just beginning to adopt this framework.
The research findings suggest several key strategies for the effective implementation of the Balanced Scorecard (BSC) model in Vietnam Firstly, enterprises should thoroughly assess the influencing factors before adopting the BSC model Secondly, it is essential to enhance the elements that contribute to the successful application of the BSC Lastly, companies must evaluate the appropriate type and scale for deploying the BSC model to ensure its effectiveness.
The thesis of Tran Quoc Viet contributed to strengthening the theoretical framework for the widespread application of BSC model for enterprises in
This study addresses the limitations of prior research on the Balanced Scorecard (BSC) model in Vietnam, focusing on its scale and scope The findings pave the way for new research avenues regarding the model's effectiveness across various fields within Vietnam Furthermore, the thesis suggests potential applications of the BSC model tailored to the unique economic conditions of other countries globally.
