DESIGN OF A GOVERNMENT OF ALBERTA BUSINESS UNIT RELEVANT BALANCED SCORECARD

Abstract

This research was conducted in the domain of performance measurement, focusing specifically on the Balanced Scorecard (BSC) model as applied to a public sector business unit. Critical issues offering opportunities through this research included exploring the feasibility of implementing a BSC in the public sector, addressing change and resistance, and the need for relevance to minimize barriers to implementation. The research question was, “How can a public sector business unit design a BSC that is relevant and valuable to both the business unit and its stakeholders, and effectively measure performance?” The research discussed here facilitated the development of an effective, relevant, and valid BSC design, and implementation presented opportunities for future research. The approach included collection and analysis of relevant responses from a survey among staff and an inventory of the business unit’s processes related to the perspectives of the BSC. The questionnaire responses (values) informed the illustration of causal relationships among strategic objectives between the four perspectives (strategy mapping) of the BSC: financial, customer (or stakeholder, for the public sector), internal business processes, and learning & growth perspectives. A linkage model with a number of strengths was developed. Criterion-related validation of the BSC design was performed using correlation analysis and showed significant relations between internal business processes and stakeholder perspectives (ρ = .22, p < .0001), financial and stakeholder perspectives (ρ = .13, p = .01), and internal business processes and learning & growth perspectives (ρ = .11, p = .014).