bsc at british airways
TRANSCRIPT
Balanced Score Card @
Members: 2010181 - 2010192
Case
British Airways served both Heathrow and
Gatwick airports in London
In 1997 the operation at Heathrow was in great
need of a change
Poor performance of British airways, urgent need
for improvement
The new manager given the task of change
management brought in
BSC Approach
Balancing all the aspects of the organization Aims of BSC:
Takes into consideration all the 4 perspectives Internal performance and external performance Lead and lag indicators.
Success of BSC lies in: Rigor in purpose Rigor in measurement Rigor in application
The Balanced Scorecard in Heathrow Terminal 5 Project has created a fresh approach to involve all key stakeholders, to move towards a quality culture.
BSC Approach focused on cause-and-effect linkages woven together.
The Approach to BSC
Top down/Bottom up?? British Airways was facing a crisis and every small
improvement mattered. The bottom-up approach provided quick measures
for improvement. BSC initiated in Baggage Handling ‘Pilot Project’ by
new manager without guidance of higher level score card.
All other managers contributed with their ideas/ relative metrics for improvement.
Since Baggage Handling was a concrete activity, it was important to involve many employees for concrete activity measures.
Implementing BSC @British Airways
Manager from BA Cargo brought into British Airways Experience in using BSC as a change
instrument
Scorecards initially implemented only for the baggage handling unit
Implementing BSC @British Airways
Off-Site meeting Description by each unit on how customers judged their operation
Derive measures based on perception Increased tangibility of scorecard Easily verifiable metrics No open discussion on BA’s organization as a whole
Implementing BSC @British Airways Scorecards required to be used by other units
added to the manager’s responsibility Each unit could come up with its own metrics tailored to
specific situations Had to explain relevance of each metric
Now used as a management control system at BA Heathrow Each unit plans operations and monitors performance
according to scorecard dimensions Reporting of unit level performance to superiors using
scorecards Units used scorecards without much attempt at cohesion
– allowed scorecard to crop up locally
Post implementation
Score cards turned around the entire way BA operated
Since it gave a structured method to measure performance, it provided a balanced approach to measure all perspectives of the bagging department
With the success of this in the bagging department it was rolled out to the front line customer service
Why did it succeed
Focus on all perspectives of the department
Provided a way to measure the intangibles, thus tangiblizing the intangibles
Vision and
Strategy
Finance
Internal business
perspective
Learning & Developm
ent
Customer
Road Ahead – The Strategic Map
Development
Process
Customers
Finance
Improve staff skills
Improve technology
Increased customer service
Increased efficiency
More satisfied customers
Improve profitability
Strong finances
BSC Challenges
The greatest challenge in implementing BSC was to convince everyone of the results
The manager proposed to manually measure some results to prove BSC effectiveness.
Different interpretations and practices of the metrics Knowledge about BSC project , no instructions within
BA about the preferred management control system. Final Alignment of all the score cards.
Learnings
Initiative can be taken up by any member of the organization. It all depends on the situation.
Creating value from assets that don’t appear on Balance sheets. The increasing use of non-financial criteria to measure performance
The intangible assets are interdependent for success
The tool can be customized based on the operating unit’s needs and expanded to other units
Thank You