BSC Flexibility & the Customer Perspective

BSC Flexibility & the Customer Perspective

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BSC Flexibility & the Customer Perspective

Terminal 5 project on Heathrow Airport was among the first projects to make full use of the Balance Scorecard system to maintain a high level of quality when conducting projects. The balanced scorecard system works by proposing equilibrium between concepts that might be conflicting to executives. This includes striking a balance between long-term and short-term goals, operational measures versus financial measures and other variables. The Balanced Scorecard model enables different parties to recognize the indefinable drivers and project results. The Heathrow Terminal 5 project was administered and completed by BAA who worked in cooperation with British Airways and other suppliers (Andersen et al, 2004). BAA had appointed over 200 employees while about 50,000 workers have been employed in the development of the terminal.

Comparison and Contrast of Balance Scorecard and Standard Score Card

A standard balanced scorecard comprises of four quadrants: the business model, the organization development, financial returns and the social outcomes. The balanced scorecard should demonstrate the whole image of the organization instead of a precise project. In the comparison and contrast between the standard balance scorecard and the Terminal 5 Heathrow Airport, the main aim is to bring out the effective qualities in the Terminal 5 project. The Kaplan Balanced Scorecard model is incorporated into the analysis of Heathrow’s project. The standard balanced scorecard has vital performance indicators, and in a similar manner, the Terminal 5 project at Heathrow airport had 5 key performance indicators, 37 performance data and 10 key measures. These key performance indicators (KPIs) are used to control the key project goals and requirements that stakeholders are established, and tests are planned before the project is complete. The key measures are also present in the Terminal 5 project scorecards that were modified to satisfy the requirements of Heathrow’s T5 contracts and the intricacy of the venture’s, air, road and rail infrastructures. The vital balancing standards of the four elements (growth, customer, learning, and internal processes and financial) of Kaplan’s balanced scorecard have been integrated into the Terminal 5 KPIs (Andersen, Lawrie & Savič, 2004).

Using the Kaplan scorecard, the enabling indicators are offered by growth and learning. However, after analyzing the Terminal 5 key measures, it was evident that a few aspects did not conform to the Kaplan scorecard. An example of the discrepancy existed in the total estimated cost of NCRs that were contained in the financial section. It is debatable that there are some breaches in the Terminal 5 key measures. Key performance indicators linked the innovation, and financial elements, but the assembly and manufacturing level KPIs would not be expected to tackle this issue. From the preceding examination, it is apparent that the elementary tenets of the balanced scorecard have been implemented and modified to the performance management systems of Terminal 5 and accomplished the precise requirements of the complicated Heathrow project.

Best Practices Relating to Project Performance

Several best practices that relate to project performance can be gleaned from the analysis of the Terminal 5 project. It is imperative that the relationship among suppliers is encouraged and practical participation of contractors in observing and enhancing project excellence and compliance with standards. Another best practice involves supplying indicators and measures and illustrating the outcomes along the project cycle until it is concluded. Lastly, a validation of the processes and metrics is done, and these are implanted using widespread deliberations with players that are accompanied by communication, training seminars and documentation. These best practices are important in that they reflect the standardized approaches that are adopted by most organizations.

Agreeability of Scorecard to Organizations

From these practices, it is evident that the balanced scorecard is extremely crucial in controlling and assessing organization processes. A balanced scorecard is important to the firm as it is captures the different aspects of the company. Therefore, any company that requires detailed information on their growth and direction will stand to benefit from using the balanced scorecard in their processes. From the way in which the Heathrow terminal 5 balanced score card was structured and applied, it is relatively simple to apply the template to any company structure in a different setting.

The analysis of the Heathrow terminal 5 Project is a significant initial step in offering assistance towards gauging, enhancing quality standards in massive projects. Preliminary studies show that, despite official quality plans that were backed by ISO 9000 certification, numerous projects managed to pass the basic tests, but failed the most significant criteria (Basu, Little & Millard, 2009). The performance management structure used in the T5 project was borrowed from other similarly massive projects. Consequently, it instilled a culture of best practices particularly the adoption of the balanced scorecard approach in key projects by linking key players and contractors. The measures in the Terminal 5 Balanced Scorecard were developed to illustrate precise project requirements, in addition to illustrating the outcomes leading to constant development. The skill of the project team demonstrates that data on non-conformance resolution (NCR) was highly effective in pointing out the expense of low quality, to enhance processes and design by assessing the causes using the suppliers or assignments.

References

Andersen, H. V., Lawrie, G., & Savič, N. (2004). Integrating quality management and strategic control through 3rd generation balanced scorecard. Performance Measurement and Management 2004, 19-26.

Basu, R., Little, C., & Millard, C. (2009). Case study: A fresh approach of the Balanced Scorecard in the Heathrow Terminal 5 project. Measuring Business Excellence, 13, 4, 22-33.