Tri-Cities Community Bank (TCCB), based in the Midwest United States, has been extremely successful over the recent years but it continues to explore ways to improve its performance further. Chris Billings, the new president of TCCB’s southern division (SD) believes that the Balanced Scorecard (BSC) could be used to boost TCCB’s financial performance. The BSC helps an organizational align activities to its vision and strategy, enhance external and internal communications, and evaluate organizational performance in comparison to achievement of strategic goals (“What Is,” n.d.). One of BSC’s major benefits relate to causal relationship mapping from nonfinancial performance measures to key financial measures monitored by TCCB. Nonfinancial measures of TCCB are classified into Learning and Growth Perspective, Internal Business Process Perspective, and Customer Focus Perspective (Stan, 2001).
Categorization of Measures into Balanced Scorecard Perspectives
|Learning & Growth |Internal Business |Customer |Financial |
|Perspective |Perspective |Perspective |Perspective |
|* Employee Training Hours |* Sales Calls to Potential |* Customer Satisfaction |* Outstanding Loan Balances |
| |Customers | | |
|* Employee Satisfaction | |* Customer Retention |* Noninterest-Income |
| |* Referrals | | |
|* Employee Turnover | |* Thank-You Calls/ Cards to New |* Deposit Balances |
| |* New products Introduced |and Existing Customers. | |
| | | |* New Loans Created |
| |* Cross-sells |* Number of Products per Customer| |
| | | | |
| | |* New Accounts | |
| | | | |
| | |* Number of New Customers | |
My categorization of Employee Training Hours, Employee Satisfaction, and Employee Turnover measures into the Learning & Growth Perspective is based on how TCCB should continue to create and improve value. To achieve the high standards set in the other three perspectives, TCCB should invest in people and infrastructure. TCCB should identify the areas where resources are required and develop a plan that empowers its employees to fulfill the objectives of other perspectives. My categorization of measures into the Internal Business Perspective is based on considering the areas that TCCB must excel. TCCB must identify processes that should be created or improved so that financial and customer perspectives can be realized. This is the reason why I placed Sales Calls to Potential Customers, Referrals, New products Introduced, and Cross-sells measures into this perspective. The concerns of customers generally fall into cost, performance, service, time, and quality categories (Kaplan & Norton, 1992). My categorization of measures into the Customer Perspective is based on how customers view TCCB. TCCB should identify its key market segments and customers. TCCB must determine
