Integration - Causal Chains and Strategy Essay Example | Topics and Well Written Essays - 1000 words

Integration - Causal Chains and Strategy - Essay Example Under the following section, each quadrant is briefly discussed, followed by their causal linkages and last part of this article provides a nine-step framework to develop such balanced scorecard system in technology-based organization. Analysis As mentioned-above balanced scorecard, system works based on four perspective such as organization capacity, internal processes, customers and financial perspective. Organizational capacity relates to the concept of increasing the capacity of the business such as production capacity, material capacity, project capacity, etc. In order to meet the demands from the customers, it is essential that the organization must have sufficient capacity to fulfill that order. Internal processes relates to the concept of how effectively the organization can perform a certain job or fulfill customer’s demand for instance. How departments are managed and integrated, how internal controls work together, etc. are the core issues highlighted through intern al processes. Third perspective solely relates to customers. Customers are most important stakeholders of any business such that their preferences, tastes, dispositions, likes and dislikes, etc. paly a profound role in developing the most adequate business strategies. From this perspective, the organization needs to assess the current demands of the customer, how to satisfy them, how to retain their loyalty, how to provide after-sales services to them, etc. are focused through this perspective. Last, but probably the most important perspective of a balanced scorecard is the financial perspective such that every organization needs to improve its financial performance and position. For this purpose, the organizations use financial ratio analysis as a technique of evaluating their performances. Some important financial ratios under this perspective include return on investment, return on assets, return on equity, net profit margin, etc. Challenges faced by Technology Organizations Befo re establishing the causal linkage between the balanced scorecard perspectives within the technology organizations, it is of crucial importance that the characteristics of technology organization are studies first. Technology organizations are the ones which can be differentiated from other organizations especially in terms of challenges that they face (Rohm and Moinoski, n.d.). Following are some of the typical challenges faced by the technology-based organizations: Their product cycles constantly and rapidly contract. They constantly have to recruit, retain and reward the best technology talent. These organizations have to make and communicate the timely and critical decisions relating to product development. They have to track the customer’s perspectives such that they have to track the customer’s featured demands and their corresponding models. They have to deal with disruptive technologies which can, not only wrap up the product but the entire business. Integratio n of Causal Chain Keeping in mind the above challenges that technology-based organizations face, the balanced scorecard system is developed through a strategy. The strategy can be referred as integration of causal chain between these four perspectives of balanced scorecard (BSI, 2007). This strategy aims at developing the organizational capacity first. The investment in organizational ca