Balanced scorecard for Gecko Eco Hotels (GEH)
Table of Contents
1. Introduction
2. GEH Background
-GEH Vision
-GEH Mission
3. The Critical Success Factors (CSFs)
4. Key Performance Indicators (KPIs)
5. BSC Diagram
6. Conclusion
Introduction
GEH is an organization that owns and runs a group of hotels with an eco friendly theme. It has three aspects: eco-sleep, eco-eats and eco-tours, this means that the GEH are socially and environmentally responsible.
GEH has sold a large issue of shares making it to get enough capital to expand its business. Although its eco friendly theme has made it to ward off many competitors, it still needs a strategy to make it stay on top o the market. It has considered constructing a balanced scorecard that has a structure of six perspectives. The organization has the following objectives:
• To develop a long term revenue growth
• To track the relationship between operating and revenue costs
• To maintain its asset to liability ratio at 70 cents per dollar
• To improve its services and processes
• To improve the lives of the community especially women and the disabled
• To provide healthier products
• To improve water supply
• To support upcoming businesses (Wilsey, 2009)
GEH Background
GEH Vision
To have a good relationship between our internal and external stakeholders and to be known as the best eco friendly organization.
GEH Mission
To provide high standardized eco friendly service while capable of earning good profit both in the medium and long term period.
The Critical Success Factors (CSFs)
CSFS include analysis of GEH’s mission, vision and its objectives. CSFs are the basics of BSC diagram, therefore all the information concerning the stakeholders is needed in respective to each perspective. The At CSFs should always reflect GEHs values of being socially and environmentally responsible. The six perspectives needed for the BSC diagram are
• Financial perspective
• Customer perspective
• Internal Process Perspective
• Employment Perspective
• Society and CSR perspective (Wilsey, 2009)
Key Performance Indicators (KPIs)
Once the CSFs have been established we need to come up with a way of measuring the progress of each CSF. KPIs enable GEH to figure out whether their objectives are being actualized. When developing KPIs, there are mainly three factors that need to be put in mind,
• Quantifiable
KPI need to be quantifiable with numbers easily.
• Readily Available
KPIs should base on the readily available information, which take less effort to measure.
• Accurate
KPIs need to be relevant to the selected CSF, which will make sure that it gives the right information for the decision making.
BSC Diagram
Financial Perspective
Financial perspective deals with revenue and cost of production of an organization. Financial ratios and objectives can be met and measured by using a systematic approach. The main CSF is to develop a long term growth which can be achieved by keeping the financial records, improving on revenue and reducing the percentage of cost of production.
Objective/CSF Measure/KPI Target Initiative
• To develop a long term revenue growth
• Maximize asset utilization
• Increase income from other facilities
• Keep records of revenue per room
• Keep record of products and service revenue
• Keep record of expenses
• Asset turnover ratio • Raise room rates by 5%
• Raise rates of products and services by 10%
• Minimize expenses by 15%
• 24 times per year • Offer entertainment to get more customers
• Come up with free special offers to clients
• Implementing new asset management software
Customer Perspective
In any business the owner has to ensure the customers are happy, when customers are happy the business will also get good benefits. To do this the owner has to provide good services required by the customer. The easy way of knowing customers preferences is through customer reviews.
Objective/CSF Measure/KPI Target Initiative
• Increase customer satisfaction • Customer reviews • To have 99% customer satisfaction • Provide better services
Internal Process Perspective
This deals with execution of strategic business processes and ideas to achieve the desired results both for the business and customers. The hotel should have good book keeping services, products and services.
Objective/CSF Measure/KPI Target Initiative
• Introduce new and better services • Start advertising new products
• Have a launch of the new products • Introduce new products annually
• Increase
• Increase advertising by 40% • Start a fitness program
• Introduce swimming services
• Offer spa services
Employment Perspective
In every company or organization when it comes to offering services the employees are the main players. Employees are the ones with direct contact t customers, for them to offer better services then they should be treated well and should be k knowledgeable in what they are doing.
Objective/CSF Measure/KPI Target Initiative
• Improve employee satisfaction and productivity
• Support employ education
• Use service appraisals
• Start educative seminars • Conduct promotions annually
• Conduct training after every 6 months • Increase salaries
• Expand vacation leave
• Offer services to employees at a discount
Society and CSR Perspective
Corporate Social Responsibility (CSR) is a built in mechanism which ensures that a business is working hand in hand with the law and ethical standards of a society. The goal of CSR is to be responsible for what the company does and encourage a positive impact on the environment, stakeholders and society as a whole. This ensures that the company is on the right side of the law and that it does not produce products that are illegal or cause pollution to the environment. In order for the company to follow the standard social responsibility, the company will show the objectives, measures, targets and initiatives it will make in order to improve the living standards of the surrounding community.
Objective/CSF Measure/KPI Target Initiative
• Help small businesses to grow
• Improve water supply in the community • Giving some work to the small businesses
• Start water projects like building wells • Getting groceries from the small businesses
• Do water projects after every 5 years • Including money spent to the businesses in the budget
• gathering necessary information concerning the water project
Conclusion
We have discussed the mission, vision and objectives of GEH and used these points to come up with CSFs and KPIs. The CSFs and KPIs are the basics of a BSC which was drafted based on the six perspectives and the three aspects of GEH, eco-eats, eco-sleeps and eco-tours. The BSC is a guideline into the organization so that they can achieve their goals.
References
Wilsey, D (2009) Balanced Scorecard Institute [online] available at: www.balancedscorecard.org/Portals/0/PDF/NWFD.pdf
