Strategic Performance Management Based On The Balanced Scorecard: A Study In Dongying Branch Of China Construction Bank

Financial outcomes had been a predominant indicator for the business control andperformance appraisal of China’s large commercial banks before the twenty-first century.Indeed, those indicators had played an important role in assessing the operations of a businessand supporting managerial decision makings. With the progressive introduction of reform onthe financial system in China since2000, however, the banks can no longer rely on capitalinvestment to obtain competitive advantages. Human resources, information, and otherorganizational assets including those intangible such as reputation, have become increasinglyimportant. Obviously, a single financial index has been unable to meet the needs of a businessfor a comprehensive picture of performance. The rapid change of financial environment andintensified competitions have force many commercial banks to develop operationalstrategies that can differentiate themselves from their competitors. Unfortunately, theimplementation of those strategies has been short of expectations.The Balanced Scorecard is a strategic performance management tool covering a wholerange of aspects. It examines the performance of a business from the perspectives of financial,customer, internal business process and learning and growth. The Balanced Scorecard canhelp an organization to translate its strategic goals into measurable targets and decomposethose targets into performance metrics. A performance appraisal system based on theBalanced Scorecard forms part of the strategic management of an organization, and provides areliable foundation for the execution and achievement of its strategic goals.At present, the changing business environment has imposed unprecedented challengesand difficulties on the Dongying Branch of China Construction Bank. There is an urgent needto improve the core competitiveness of the bank and to consolidate its share in the market. This study aimed to introduce an innovative approach to performance management in theDongying Branch of China Construction Bank. The Balanced Scorecard was adopted toensure consistencies between employee behaviors and organizational expectations. Keyresearch methods used in this study included literature review, empirical analysis, hierarchyanalysis and case analysis. Findings of this study will not only encourage the DongyingBranch of China Construction Bank to improve its managerial practices for competitiveadvantages, but also offer lessons to other commercial banks in China.