Strategy and a balanced scorecard


According to Molleman (2007), a balanced scorecard is a performance metrics that is used to measure financial goals set by the organization to achieve its vision and implement necessary strategies to achieve the set objectives. Kaplan (2010) discusses that financial performance is the real measurement of outcome in any organization. Further, he elaborates that factors which supplement the financial metrics include, customer, internal processes, learning, and growth.

Qantas Airways Limited in Australia is one of the major airlines operating both domestically and internationally; it helps connect Australia with eighty-one different destinations in the world and it is also one of the oldest in the world enjoying ninety years in the business, this is after KLM of the Netherlands.

As discussed by Basuony (2014), performance metrics based upon financial measurement considers only the past and not the future, managers should be able to manage the future but not to let the past control them. The balanced card is a measure of performance; it helps a business to see what they targeted for and what they have achieved.

However, Madsen and Stenheim (2014) asserts that the balanced scorecard has different uses, these various ways help the managers to come up with the means to use the BSC to add value to their companies. The year ending June 2015, Qantas airline had grown their revenue by two billion under the leadership of Allan Joyce the C.E.O using the balanced scorecard. Also, the company increased their capital return by sixteen percent compared to the previous year; this was a significant margin which helped them in reaching the two billion operating capital mark.

Qantas had targeted to achieve the following in this area, two billion gross benefits, ten percent fuel reduction, and five thousand full-time cuts. In these objectives, they gained one point one billion total benefits, six percent fuel reduction and four thousand full-time deductions. They did not achieve any of these targets but what they achieved was considerably a lot within just a year.Qantas was able to reduce its expenses on some things; they reduced the cost of fuel by over ten percent this was a significant decline that was caused by the Australian weak currency (Basuony, 2014).

Large organization find the balanced scorecard of benefit in areas such as specialization and change of structure. Qantas airline reduced the variety of different seat types from eleven to nine; it helped to increase more customers and expenses incurred due to the large number. Qantas also cut the aircraft fleet; this made it easier to work with a lesser flight that could be handled easier and required less fuel to operate. In this, they had these objective goals to accomplish, reduction of debt by one billion, and reduction of the debt to revenue percentage of fewer than four times.

In this they achieved reduction of debt by one billion one hundred million, this was successful since they had reached their target. Also, they produced a percentage of two point nine compared to the four in less than a year of setting the three-year target. Qantas airline had aimed to reduce its fleet from eleven to seven; in less than a year they achieved to reduce it to nine. The fleet reduction was very encouraging since they had done a major job in trying to reach their target. (Kaplan, 2010) indicates that other than financial measures there are other non-financial matters like customer satisfaction.

The balanced scorecard aid managers should not only look at the financial matters but also the non-financial issues like customer satisfaction. Qantas airline boasted of having the most on time domestic flights throughout the year, this increased the customer satisfaction and made the customers regard them better, and they could instill their trust in them (Madsen and Stenheim, 2014). The increased satisfaction made them get higher returns on passenger compared to the previous year that, this increased their revenue significantly which attributed to their nine hundred and seventy-five million underlying profit. The company aimed to improve the client satisfaction and also to be the most on-time carrier. In these marks they achieved both of them, this was very remarkable, and they boasted of having the greatest customer satisfaction in years.


Molleman, B.(2007). The challenge of implementing the Balanced Scorecard. The proceedings of the 6th Twente Student Conference on IT, Enschede, 2nd February 2007

Kaplan, R. S.(2010). Conceptual Foundations of the Balanced Scorecard. Harvard Business School, Working Paper 10-074

Basuony, M. A. K. (2014). The Balanced Scorecard in large firms and SMEs: A critique of the nature, value, and application. Accounting and Finance Research, 3 (2), 14-22

Madsen, D. O., and Stenheim, T.(2014). Perceived benefits of balanced scorecard implementation: Some preliminary evidence. Problems and Perspectives in Management.