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Financial perspective

CCC should aim to provide better returns to shareholders. They should focus on improving dividend yield which will combat the criticism from investors. They need to set a specific target of x% yield by a specific deadline, and then make operational changes such as cost cutting to try to achieve this.

Internal business perspective

CCC could focus on using technology to enhance processes. They could aim to replace all outdated tech (x years old) by the end of 2025.

Learning and growth perspective

CCC have struggled with under-qualified staff so should aim to improve this. They may aim to have x% of staff suitably trained by 20XX. To do this, they could incentivise staff to undertake training by assisting with fees.

Customer perspective

CCC have seen increased customer churn over the last few years, so need to change this by improving customer service and retention. They could measure the volume of customer complaints and aim for it to be trending downwards, and target complaints to be under x% by the end of the year. To do this, they should provide training to staff on objection handling.

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Financial -

We could use gross or operating profit margin as a financial measure, and analyse performance of this ratio over a number of years for comparison. This would allow us to determine whether we are improving profitability, and if costs in certain areas are rising too high. This should give shareholders an indication of the business’ performance and its profitability. We could use a target of perhaps over 30%, with an aim to increase by 5% over a 5 year spread.

Customer -

We can use a non-financial measure for this perspective, focussing on the current customer loss rate we are experiencing. This loss has been caused by poor customer service, so we could use a measure such as improved customer service (perhaps by training or employing additional staff if we lack the appropriate level of staff to provide a good service), measured through the percentage of customers renewing their insurance. A target we could aim for could be to keep customer renewals over 50% on a yearly basis.

Innovation and learning -

For this perspective, we can use the recent audit’s findings of lack of formal qualifications and skills in 3 departments, leading to an unacceptable level of errors being made. We could aim to remedy this issue by organising the appropriate training for staff in these departments, and use this as a measure of innovation and learning on the balanced scorecard. We could use a target of sending over 70% of the highlighted staff on the appropriate training courses in the next year, and employ some sort of process to check in a year to 3 years’ time whether they have gained the necessary skills from this training.

Internal processes -

For the internal processes perspective, we could use the current issues highlighted with staff’s PCs as an objective. As there have been complaints that PCs are too old and do not have current day capabilities, and an initiative to bring PCs up to date hasn’t been undertaken since 20X1, this would be an appropriate initiative to focus on for this perspective. We could use a target of the average age of PCs for staff being 2-3 years old, younger than the current age of 5, and look to introduce internal processes that mean staff PCs are checked and replaced when necessary.

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I would recommend:

Financial perspective -

Objective - Shareholder satisfaction

Measure - Increase returns and dividends

Target - to double turnover over the next 4 years

Internal Business processes

Objective - improve the dated technology

Measure - roll out of the updated PCs and a fixed asset register to ensure that rolling programme implemented.

Target - All staff to have a computer no older than x years old

Learning and Growth perspective

Objective - for all staff to have a development plan to bring their qualifications to level with the role.

Measure - Ensure PDPs inplace for all staff with gaps highlighted and target dates to achieve the development

Target - to be achieved by x date.

Customer perspective:

Objective - To achieve excellent customer satisfaction

Measure - higher ratings on external ratings agencies (trust pilot etc) and internal feedback obtained on surveys.

Target - to be ranked as top insurance company within the country by x

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Financial - The target should be to increase dvidend payments year on year. In order to achieve this CCC could implement a bonus scheme for senior managers to improve profitability of their individual departments, through a higher net profit we can pay more for dividends.

Customer - The target should be focused around customer retention rate to improve from 85% to 90% and further once that target is met. CCC has already tried to implement a discount scheme to improve this however poor execution from the sales team had made this less effective. My suggestion would be to also monitor how frequently the sales execs are offering the discount to customers which should be at 100%.

Learning & Growth - We should be focused on training staff in order to close the skills gap. We could measure this by implementing mandatory training and measuring the uptake of this training.

Internal Business - The computer systems need to be improved and maintained. We can measure this by the age of computers in the building in order to stay up to date we could implement a policy that all computers should be replaced after 3 years and measure how well that is adhered to.

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One drawback of BSC is that the staff at CCC become too competitive and do not work as a team moving forward as they are interested in their own performance for selfish reasons. An example of this could be the customer perspective, where employees have targets to hit and abuse discount schemes to ensure that targets are hit rather than what would be financially beneficial for CCC.

Another drawback could be that there is a focus taken away from more minor aspects of the business as the entire employee base becomes obsessed with the 4 metrics on the balanced scorecard. For example, the company may look high-performing on the balanced scorecard, but other metrics that aren't measured such as employee satisfaction, staff turnover and profit margins are ignored as they do not have a place on the BSC.

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Financial Perspective:

-Increase the dividend yield for investors

-Increase dividend yield by 10% in line with the targeted growth rate.

-Improve the overall profitability and growth rate of the company

Customer and Stakeholder Perspective:

-Improve the overall customer service

-See customer satisfaction rates rise

-Try to retain 5% more customers

-Offer better customer service and make sure to make customers aware of discount schemes

Internal Audit:

-Staff become better educated

-Less errors being made

-Reduce the amount of errors by 10%

-Offer Staff Training

Sales staff

-Improve the hardware sales staff use

-Assess the effectiveness of new PCs and how this will benefit work

-Try to make sure all PCs are up to date in next 2 years

-Offer new equipment to staff

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The Balance Scorecard is an approach to assist policy formulation and achievement. It’s used to provide performance objectives that include both financial and non-financial elements, covering the full range of the business activities.

It has four perspectives: financial, customer, internal and learning and growth. It helps the business consider the impact of gains in one area and how this may then negatively impact another section of the scorecard.

CCC’s vision statement aspirations nicely aligns to each section of the Balanced Scorecard and is likely to be well suited in the creation of performance objectives. For example the vison element for ‘delight our customers’ would be captured and considered within the customers perspective of the Balance Scorecard.

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A balanced scorecard could help CCC achieve their vision by placing emphasis on each area of their vision by tying it to a scorecard component:

Financial Perspective - 'provide superior returns to shareholders'

Internal business perspective - 'continually improve our business processes'

Learning and growth perspective - 'learn from our mistakes and work smarter in future'

Customer perspective - 'delight our customers'

If CCC can set objectives and establish targets within each perspective, they can ensure they take operational actions to achieve these.

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Financial Perspective - Investors have been critical of the low dividend yield they have received on their shares. In order to improve this, CCC may be able to target a specific figure for their dividend yield to keep shareholders happy.

Internal Business Processes - CCC could look to decrease the average age of their equipment to ensure that they are maintained. This also could be linked to SMART objectives as they could aim for a specific age by a certain date.

Learning & Growth - To avoid errors arising from lack of qualifications, CCC could have a metric that ensures that all employees have undergone some training to a certain level, and a certain percentage hold the right qualifications.

Customer Perspective - Poor customer service led to CCC losing 15% of customers in 23/24. To avoid this in the future, CCC could measure how many customers renewed their insurance and place schemes to ensure this figure is maintained.

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The balanced scorecard is a technique we can use to give us a well rounded perspective of the company, with areas to focus on for improving performance whilst not neglecting other areas that are critical to business success.

Our mission statement highlights the importance of growing through quality and improved customer service, and our current vision statement actually covers the 4 perspectives of the balanced scorecard - financial, customer, internal process and innovation and learning - which means that using the balanced scorecard would allow us to focus on these 4 areas of our vision statement, and improve performance in these areas in order for us to achieve this vision.

The different perspectives of the balanced scorecard would also allow us to focus on improving performance in the areas that have been highlighted by T as areas of concern; poor customer service, old fashioned computers without current day capabilities and lack of qualifications and skills in essential staff are all areas that are covered in the customer, innovation and learning and internal processes perspectives of the balanced scorecard. Using the balanced scorecard would enable us to focus on these areas and improve our performance.

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Implementing a balanced score card, could support in delivering the CCC visiosn and strategy. It does this through 4 different lenses / perspectives of the company for example:

Financial perspective - focusing on doubling the turnover of the group over the next 4 years, will this ultimately drive shareholder returns, only if the actions taken to generate additional revenue remain profitable.

Internal Business processes - ensuring that the group has efficient and effective processes to deliver for their customers.

Learning and growth - Concerns over staff with minimal educational qualifications and could help with supporting staff development for ensuring they have the relevant qualifications for their roles. Which would in turn lead to better customer outcomes.

Customer perspective - monitoring customer feedback and adapt to common themes of what works well and what can be improved.

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A balanced scorecard can help align vision as it combines both financial and non-financial measures to provide a more rounded view of success for a business.

There are four main factors that are looked at in a balanced scorecard - financial perspective, internal business processes, learning & growth and customer perspective. By following this outline given by Kaplan and Norton you will be able to ensure that multiple viewpoints are prioritised.

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One drawback of using the balanced scorecard is that there is no clear relationship between the balanced scorecard and shareholder analysis. CCC’s vision statement includes providing superior returns to our shareholders, and investors have been critical of the low dividend yield on their CCC shares, but using the balanced scorecard will not necessarily allow us to analyse and understand our shareholders and their motivations, despite the growing pressure to improve returns and performance.

Another drawback is it often involves a substantial shift in corporate culture in order to implement it. Given staff’s dissatisfaction with the technology they have been given to work with, and the fact that it is likely many staff will need to undertake additional training to bring their knowledge and skills to an acceptable level than they currently are, introducing the balanced scorecard on top of this could create tension and negatively impact staff morale.

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Greater Organisational Involvement and can help align strategies to put in place in order to meet their vision which is wanting to 'continually grow through its commitment to quality' which they are not doing at the minute due to poor customer service

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A balanced scorecard looks at 4 main perspectives of a company, financial, customer, internal business process and learning/growth to see how we are performing and where improvements can be made. The mission statement of CCC targets improvements in all 4 areas, by identifying those key perspectives we can meet the mission statement of the company.