The Implementation and Impact of the Balanced Scorecard on Shared Service Units: A Car Dealership Case

38 Pages Posted: 16 Aug 2011

See all articles by Tsuilin Kuo

Tsuilin Kuo

Fu-Jen Catholic University

Anne Wu

National Chengchi University (Taipei)

Date Written: August 14, 2011

Abstract

Many organizations implement the Balanced Scorecard (BSC) in their headquarters and strategic business units (SBUs), but not in the shared service units (SSUs). Kaplan and Norton (2006) indicate that it is important to implement the BSC on SSUs in order to provide administrators with information for creating organizational synergies. In other words, in order to gain organizational synergic benefits from the BSC, it is significant to align headquarters, SBUs, and SSUs. Few studies in the literature show the alignment between different departments and SSUs, and the impact of the BSC on SSUs. We study a large car dealership case that meets a misalignment among SBUs and SSUs, and hence the case implements the SSU scorecard. This study examines two issues related to the SSU scorecard: first, we illustrate the implementation and six steps for the SSU scorecard; second, we examine the impact of the BSC on employees’ cognition and behavior changes of SSUs. To understand whether employees have cognition on organizational strategy after the implementation of the SSU scorecard, we first conduct a survey on the company’s SSU employees after one-year implementation. The results show that most employees in SSUs strongly sense and understand strategic themes, strategic objectives, and strategic performance measures after the BSC. To understand whether employees’ behavior changes after the implementation of the SSU scorecard, we do a second survey and interviews after two-year implementation. We find that the managers and employees from SSUs change their behaviors from doing “their own job” to supporting SBUs for improving strategic execution.

Keywords: Balanced Scorecard, Shared Service Units, Strategic Business Units, Alignment, Cognition, Behavior Change

Suggested Citation

Kuo, Tsuilin and Wu, Anne, The Implementation and Impact of the Balanced Scorecard on Shared Service Units: A Car Dealership Case (August 14, 2011). AAA 2012 Management Accounting Section (MAS) Meeting Paper, Available at SSRN: https://ssrn.com/abstract=1909664 or http://dx.doi.org/10.2139/ssrn.1909664

Tsuilin Kuo (Contact Author)

Fu-Jen Catholic University ( email )

No. 510, Zhongzheng Rd., Xinzhuang Dist.
New Taipei City, 24205
Taiwan
886-2-2905-3999 (Phone)
886-2-2904-7925 (Fax)

Anne Wu

National Chengchi University (Taipei) ( email )

No. 64, Chih-Nan Road
Section 2
Wenshan, Taipei 11623
Taiwan

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