A balanced scorecard will have very beneficial effects to the On-The-Go-Convenience-Store performance measurement. Currently the business division is not meeting the financial expectations, however focusing only on a financial metric may lead to a very myopic vision of the issue and therefore lead to the wrong decisions by the managers with other serious problems left overseen.
The organizational objective of the OTG-CS is be to increase profits and therefore to increase shareholders value for the owners of On-The-Go Ltd. To achieve those objective, a Balanced Scorecard model suggests to focus on four key perspectives: Financial, Customer, Internal Business Process and Learning and Growth. ...view middle of the document...
The first objective to consider is to increase sales, the metric used will be revenues. In order to keep track of improvements in this metric and to check whether the target has been met, general managers will be required to submit monthly reports on past sales trends and expected future trends for each category of items ( eg., tobacco, snacks, liquors..). Complementary to general sales we want to incentivize managers to boost sales during theme-based promotions. Targets will be set by the VP of OTG-CS together with the regional managers.
Internal Business Process
General Managers are in charge of assuring that all the items are never out of stock, therefore one objective will be to improve the efficacy and fastness of stock replenishments and also a measure of general compliance with standards. In order to reach those objective we suggest to set up a direct line to collect customers’ complaint. There should also be walk-through audits, the results of which will be reported directly to the VP. A system of mystery shoppers ratings can be put in place in order to keep better control of general managers performance in assuring quality standards. To improve the overall internal business, general managers are encouraged to send suggestions and their own complaints to the regional managers. If financial results in a period were extremely low and there were no contacts between the general and the regional managers, it could be inferred that general managers did not put 100% effort in improving sales and quality standards for the store.
Learning and Growth
General managers need to identify themselves with the company and to do so it is necessary that the OTG organizes training days either every 6 months or every year to instruct general managers about their contribution to the OTG profitability, to present them the new challenges of the future periods and to discuss present and future growing opportunities. In...