Application of Balanced Scorecard in Sears Holding Company

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The primary focus of establishing a business venture is to make profit and advance in the market. There are other objectives for venturing into a business which includes maximizing profit and output, retention of customers and employees, maintaining a strong financial base and future business growth. Business failure arises when a venture fails to realize the set objectives. Sears (SHC) Company in America is a Holding organization with a head office in Illinois, Chicago. The iconic American brand is on the verge of liquidation due to bankruptcy (Caplan & Saulav 39). Sears Company is closing its stores due to losing money from tumbling sales. BSC can be the right framework to identify and evaluate new initiatives that Sears holding can implement.

The BSC framework

The development of the Basic Scorecard thinking originated from the works of Kaplan and Norton at the start of the 1990s (Taticchi & Paolo 10). However, many organizations in the world have adopted and modified it as they apply it in their respective settings. If organizations understand and use the framework efficiently, it guarantees for quantifiable success. Scorecard links strategy and vision in four theoretical parts which include financial stability, proper customer interrelations, better internal processes and organizational growth (Taticchi & Paulo 11). Adaptability and flexibility of the model are the main reasons for its popularity. The framework applies to companies, public corporations, and non- profit organizations which are stanch to a specific situation. The newly launched scorecard performed a holistic performance in notional quadrants (Taticchi & Paulo 8). The modified scorecards allow companies to define their strategies in achieving higher- level objectives.

Application of BSC Framework to Solve Failure of Sear: SHC Company

Putting Strategies into Operations

Balanced scorecards enable management to control accomplishment of the set objectives. Balanced scorecard also allows coordination of various departments of a company which operates as a whole, not as separate entities. Consequently, scorecard associates activities of different departments with strategies of an organization. Tactical themes and main concern are embedded within the reporting arrangements to facilitate a persistent message and set company policies which go through different departments (Yang & Wan 838). Making proper business strategies is instrumental to Sear company which needs to fix its objectives right to improve its deteriorating performance.

Align the Organization to Objectives

The scorecard enables the company to attain persistent strategic focus. It also helps the company to create a rank between the permanent and temporary priorities (Caplan & Saulav 40). Persistent strategies allow a company to reflect what the company needs to do internally to attain strategic outcomes and provide a system of segmenting approach into various general projects. The reason for failure in Sear Company might come from derailment from the primary strategies (Caplan & Saulav 41). Thus, BSC framework is vital to such a company because success would be guaranteed if Sear remains focused.

Make Strategy Everyone's Work

BSC framework requires the entire workforce to understand the company's strategy and perform in a way to realize those set objectives. The principal founders Kahlan and Norton gave three strategies in aligning workers to the approach which include education and communication, personal and workforce development together with the provision of incentives and good reward system (Yang & Wan 839). This is what is needed in Sear holding. The employees of Sear Company need to feel that their every effort is recognized and appreciated. If there is total involvement of Sear's workers, the company's output will increase, hence facilitating to improvement in performance.

Make Policy a Constant Process

BSC framework necessitates for a progression of strategy administration due to continuous changes in working conditions (Caplan & Saulav 42). BSC also stipulates the role of budgets in managing procedures. Budgets define the locally available resources and also performance of targets. BSC also advocates for companies to maintain both operational budget and the strategic budget (Caplan & Saulav 43). Also, the balanced scorecard operates by controlling the measuring actions and their impacts, imparting a potential of the managers in responding to the stakeholders. Apparently, for better results, sear (SHC) needs to regulate the exploitation of its resources especially the financial budget to thrive in the market.

Mobilize Change Through Executive Leadership

In this level, BSC requires an explicit and absolute commitment of top-level employees. The balanced scorecard is about major changes. The most successful administration of BSC is its request for ownership and total involvement of the managers (Taticchi & Paolo 13). Its criteria for success is that the starting unit which has senior management emphasizes participation, communication, and employee participation. The obligation of top-level employees is adequate in launching a process, establishing necessary approaches and modifying management systems (Taticchi & Paolo 13). The BSC framework can transform Sear Company through arousing the high-level employees on the need to monitor the daily operations actively. The senior managers of Sear holding would be compelled to communicate the vision for improvement and empower the employees to devise strategies to attain the company's objectives. If the initiative for development comes from the seniors of Sear Company, the success is likely to happen.


Sear (SHC) faces a likelihood of liquidation due to poor performance. In order have proper initiatives for improvement, BSC framework is necessary to identify and monitor various action which guarantees for improvement. BSC framework can help Sear Company to control various activities of an organization by linking strategy with vision. The scorecard can also help Sear Holding to strategize operations, converge the organization to the set objectives, making strategies a continuous process and mobilizing leadership to initiate improvement.

Works Cited

Caplan, Dennis H., Saurav K. Dutta, and David J. Marcinko. "Lehman on the brink of bankruptcy: A case about aggressive application of accounting standards." Issues in Accounting Education Teaching Notes 27.2 (2012).

Taticchi, Paolo, Flavio Tonelli, and Luca Cagnazzo. "Performance measurement and management: a literature review and a research agenda." Measuring business excellence 14.1 (2010).

Yang, Jen-Te, Chin-Sheng Wan, and Yi-Jui Fu. "Qualitative examination of employee turnover and retention strategies in international tourist hotels in Taiwan." International Journal of Hospitality Management 31.3 (2012).

January 19, 2024



Corporations Management

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