1. Balance Scorecard Proposal for
King Fahd University of Petroleum & Minerals
Department of Construction Engineering & Management
CEM – 515: Project Quality Management
Balance Scorecard Proposal for
Professor Abdulaziz A. Bubshait

2. Outline Purpose of Study Bakheet Co. Company Profile Literature Review
Balance Scorecard (BSC) Background
Proposed Balanced Scorecard for
Bakheet Co.
Conclusion

3. Purpose of Study
In spite of their struggles for a continuous improvement and the significant end-of- year performance, Bakheet Co. is able to improve by adopting the Balance scorecard system (BSC). So, my term paper I will introduce a typical BSC system for Bakheet Co.

4. Bakheet Co. Company Profile
Bakheet Co. for Machinery Ltd. was established in 1975 by three ambitious individuals. Two of them are from Bakheet family and one from Al Rifai family.
The Second Generation of those two families is still active in the company to date.
Bakheet Company headquarter is located in Jeddah. The other six branches are spread in:
RIYADH, DAMMAM, MEDINA, GASSIM, TABUK, AND ABHA.

5. Bakheet Co. Company Profile
Company's Activities:
Provides equipment and support for construction and paving industry. (core business)
Diversified in distribution of tools and workshop equipment known as most comprehensive in KSA.

6. Company Profile

7. Literature Review Concept:
Conducted by Dr. Robert Kaplan from Harvard and Dr. David Norton with Nolan & Norton.
One year research project included 12 companies at the leading edge of performance measurement.
Comparative analysis conducted between these 12 companies and today's general measurement practices.
Notes

8. Using a Scorecard by Industry Sector
Manufacturing/Service
General Electric
Cargil
Johnson Controls
XEROX
IBM
United Parcel Service
BellSouth
AMOCO Corp
NOVA Chemicals
Siemens
Solvay Pharmaceuticals
Anheuser Busch
Motorola
Amazon.com
Baltimore Gas & Electric
Hewlett Packard
Honeywell/AlliedSignal
Johnson & Johnson
Shell Oil Company
MCI Worldcom
Health Care
Methodist Healthcare
BJC
Novant Health
SLSMHS
Eden Medical Center
Northwest Hospital
Overlake Hospital
Duke Children’s
Saint Joseph Mercy
Mayo Clinic
Suburban Hospital
Advocate HealthCare
Duke University Medical
Peel Memorial
Henry Ford Health
King’s College Hospital
Shayne Medical Center
North Shore Health Region
Good Samaritan Hospital
Education
University of Michigan
University of
Wisconsin Stout
University of San Diego
Educational Testing Srvs
Harvard
University of Montreal
University of Missouri
Outreach & Extension
Notes

9. Balance Scorecard (BSC) Background
BSC consists of a set of superior combinations of financial and non-financial measures that provide a comprehensive view of the business to guide strategy development, implementation and communication.
It also provides reliable feedback for management control and performance.

10. Balance Scorecard (BSC) Background
The Scorecard allows an organization to look at their performance from four important perspectives:
How do customers and other key stakeholders see us (customer perspective)
What must we excel at (internal perspective)
Can we continue to improve and create value (innovation & learning perspective)
How do we look to financial holders (financial perspective)

11. Example based on a real semiconductor Co.
Financial Perspective
Goals Measures
Internal Business
Perspective
Innovation & Learning
Customer Perspective
New
Products
Responsive
supply
Preferred
supplier
Customer
partnership
% of sales from new
products
% of sales from
proprietary products
On-time delivery (defined
by the customer)
Share of key accounts'
purchases
Ranking by key accounts
Number of cooperative
engineering efforts
Survive
Succeed
Prosper
Cash flow
Quarterly sales growth
and operating income by
division
Increase market share and
ROE
Technology
leadership
Manufacturing
learning
Product
focus
Time to
market
Time to develop next
generation
Process time to maturity
Percent of products that
equal 80% of sales
New product introduction
vs. competition
capability
excellence
Design
productivity
New product
introduction
Manufacturing geometry
Cycle time
Unit cost
Yield
Silicon efficiency
Engineering efficiency
Actual introduction
schedule vs. plan
How do we look
to shareholders?
What must we
excel at?
Can we continue
to improve and
create value?
How do
customers see
us?
Notes

12. The Proposed Balanced Scorecard for Bakheet Co.:
Before proposing a BSC for BAKHEET Co. I will propose a vision, mission and objective.
Bakheet Co. Proposed Vision:
To become a leading heavy equipment agent in Saudi Arabia with a focus on seamless customer relationships and delight.

13. The Proposed Balanced Scorecard for Bakheet Co.:
Bakheet Co. Proposed Mission:
To participate in developing Saudi industry and economy through providing quick solutions and ensuring the delivery of quality after sales support for Bakheet Co. customers to enable them to accomplish their works efficiently.
To operate the company on a sound financial basis of profitable growth, increasing value for Bakheet Co. shareholders and creating career opportunities and financial rewards for their employees.

14. The Proposed Balanced Scorecard for Bakheet Co.:
Bakheet Co. Proposed Objectives:
The objectives of Bakheet Co. are to increase revenues through expanded sales to existing and potential customers, become service oriented, achieve excellence in order fulfillment through continuous process improvements and to align employee incentives and rewards with the strategy.

15. Bakheet Co. Proposed Financial Perspective Goal and Measures:
How Do Bakheet Co. Look to Shareholders?
Financial Perspective
Goals
Measures
Return on Spending
Net Income /Expenses Saudi Riyal
Revenue Growth
% increase in year to year revenue
Reduce Costs
% reduction in cost of sales and after sale services

16. Bakheet Co. Proposed Customer Perspective Goal and Measures:
How Do Customers See Bakheet Co.?
Customer Perspectives
Goals
Measures
Value Proposition for New Customers
Survey of now customer satisfaction , including feedback in:Bakheet value proposition Employee knowledge and capabilities Convenient access
Provide Consistent/
Seamless Service
Survey of existing customers on:
Quality
Availability
Responsiveness
Errors and defects
Retain Existing Customers
Customer retention rate in targeted segments

17. Bakheet Co. Proposed Internal Perspective Goal and Measures:
What Must Bakheet Co. Excel at?
Internal Perspectives
Goals
Measures
Achieving excellent supplier relationship
% strategic partnerships established with
suppliersSupplier scorecard, with rating on
Cost
quality
Delivery
Flexibility
Developing high quality supplier capability
% perfect order receivedPart-per ten defect rates from supplier %defect, incoming orders % supplier qualifies to deliver without incoming inspection

18. Bakheet Co. Proposed Innovation & Learning Perspective Goal and Measures:
How Do Customers See Bakheet Co.?
Innovation & Learning Perspectives
Goals
Measures
Reskilling
competencies to accomplish aggressive revenue generation targets
Strategic Information
The amount of information and knowledge possessed by the employees on company processes, equipment, and customer
Accountability
The extent to how incentive program are affection.
The extent to how personal goal align with the company goal.

19. The Final Proposed BSC for Bakheet Co.
Financial Perspective
Goals Measures
Internal Business
Perspective
Innovation & Learning
Customer Perspective
New
Products
Responsive
supply
Preferred
supplier
Customer
partnership
% of sales from new
products
% of sales from
proprietary products
On-time delivery (defined
by the customer)
Share of key accounts'
purchases
Ranking by key accounts
Number of cooperative
engineering efforts
Survive
Succeed
Prosper
Cash flow
Quarterly sales growth
and operating income by
division
Increase market share and
ROE
Technology
leadership
Manufacturing
learning
Product
focus
Time to
market
Time to develop next
generation
Process time to maturity
Percent of products that
equal 80% of sales
New product introduction
vs. competition
capability
excellence
Design
productivity
New product
introduction
Manufacturing geometry
Cycle time
Unit cost
Yield
Silicon efficiency
Engineering efficiency
Actual introduction
schedule vs. plan
How do we look
to shareholders?
What must we
excel at?
Can we continue
to improve and
create value?
How do
customers see
us?
Notes

20. Conclusion The following cornerstones needed to be taken
into considerations
No single measure can provide a clear target or focus attention on the critical areas of the organization
Leaders need a set of measures that gives them a fast but comprehensive view of the organization
Leaders need a structure that minimizes information overload by limiting the number of measures used
Notes