A balanced scorecard framework for the mechanical industry: a case study

The Balanced Scorecard is a framework that expresses an organization’s strategy as a set of measurable goals from different perspectives (owners/investors, other external stakeholders, and the organization itself). The Balanced Scorecard helps both managers focus on the actions required to achieve their goals, and the organization to achieve its overall strategic goals and to realize its strategic vision. The main objective of this study is to develop a general Balanced Scorecard model that is designed and delimited for firms belonging to the mechanical industry. With this purpose in mind, we propose to validate the content of a general Balanced Scorecard model for the above mentioned industry. For this we design a measurement instrument that includes all the appropriate variables, financial and non-financial, starting from the structure of the classic Balanced Scorecard. The result is the design of a Balanced Scorecard that has been subject to testing with recognized experts of the mechanical industry. In this paper we also present the application of our model to a mechanical firm. The constructed indicators could serve as a reference for the mechanical industry to establish applicable performance appraisal indicators. The research findings show that cost control, profit growth, and sales growth are the top three indicators in the financial perspective, while service/product quality, customer satisfaction, and service timing are the three major indicators in the customer perspective.