Adoption of the Balanced Scorecard by State Corporations Within the Ministry of Information and Communication, Kenya

Abstract

Purpose: The study sought to examine the adoption of the balanced scorecard by state corporations within the ministry of Information & Communication in Kenya. The study was guided by the following specific objectives: to assess the extent to which balanced scorecard has been adopted in state corporations in the Ministry of Information and Communication; and to evaluate the benefits derived from adoption of the balanced scorecard practices in state corporations in the Ministry of Information and Communication.

Methodology: Survey design was used to undertake the study. The population of interest was all state corporations in the Ministry of Information and Communication, whose number stood at 10 as at June 30^th 2011. Primary data was collected through questionnaires sent to respondents who are involved with the formulation and implementation of organization’s strategies. This ensured data collected is useful to meet specific objectives of the study. The questionnaires were sent to Customer Relation Manager, Head of Finance, Head of Business Development and Head of Operations. Descriptive statistics were used to analyze data pertaining to objectives of the study. Computation of frequencies in tables, charts and bar graphs were used in data presentation. In addition, the researcher used standard deviations and mean scores to present information pertaining to the study objectives. The information was presented and discussed as per the objectives and research questions of the study.

Findings and Discussions: The balanced scorecard may serve as a strategic management system in an organization. Findings of the study indicate that the BSC in practice is a system, which primarily encourages managers at all levels to make strategic decisions based on the company’s common strategies. In developing the BSC concept further, the study findings indicate that the benefits from using the BSC in organizations include: clarify and gain consensus about strategy; communicate strategy throughout the organization; align departmental and personal goals to the strategy; link strategic objectives to long-term targets and annual budgets; identify and align strategic initiatives; perform periodic and systematic strategic reviews; and obtain feedback to learn about and improve strategy. The balanced scorecard acts like as a new strategic management system. The system is expected to link an organization’s long-term strategy with its short-term actions.  A well developed and implemented balanced scorecard should focus on the following four critical management processes, namely (i) clarify and translate vision and strategy;  (ii) communicate and link strategic objectives and measures; (iii) plan, set targets, and align strategic initiatives, and (iv) enhance strategic feedback and learning.

Keywords: Balanced scorecard; Financial Perspective; Customer Perspective; Internal Business Process Perspective; Learning and Growth Perspective