The Discussion Of The Performance Evaluation Index System Based On Combining EVA And BSC In Jiangling Company Application

Jiangling Motors Corporation,Ltd.(JMC)is the largest car company in our province.The company has been developing rapidly since it was established in 1968 and it is one of China’s largest commercial vehicle industry enterprises now,ranking the hundred listed companies in China for five consecutive years.Besides,the company’s operating indicators hit a record high,sales revenue reached 25.5 billion yuan and car sales reached 276,000 in 2014.But with the expansion of business scale,the company’s profitability and competitiveness does not reflect a corresponding growth.The reason is that the enterprise’s performance evaluation system does not carry out innovation or improvement with the times,which still uses the financial indicators based performance evaluation system,but doesn’t uses the performance evaluation system that takes financial,customer,internal operations management and potential innovation into consideration at the same time.Therefore,this paper will introduce the combined EVA and BSC performance evaluation system into JMC’s performance evaluation in order to explore the company’s multi-faceted and multi-angle evaluation,through which reflects the company’s operation timely and provides the valuable decision-making information for business decision.This paper first introduces the balanced scorecard performance measurement system and the performance evaluation system based on EVA,their features and their operating procedures,then analyzes the advantages and disadvantages of the two performance evaluation system.Based on this analysis,the article explores the possibility of complementary and integration between the two performance evaluation systems.EVA can strengthen the economic value of BSC system and BSC system can make up for the lack of EVA financial results.Therefore,the EVA-BSC system can reflect the performance of the enterprise not only from the perspective of the economic value of shareholders,but from enterprise comprehensive strategic management.Secondly,the article analyzes the existing problems in performance evaluation and the cause of the problem,for example it is not combined with corporate strategy and it is more emphasis on the financial evaluation and so on.On this basis,this paper designs the EVA-BSC performance evaluation index system,which includes financial dimension,the customer dimension,internal business processes dimension and learning and growth dimension.The EVA-BSC performance evaluation index system gets the EVA into the financial dimension and it is a key indicator of financial dimension.The EVA-BSC performance evaluation index system includes 35 specific indexes in total.Through the collection of JMC’s income statement data,balance sheet data and annual data from 2012 to 2014 and the determination of the index weight by entropy method,the article makes a comprehensive and systematic evaluation of the company’s operating results from 2012 to 2014.Third,compare the performance of the company with excellent value,good value,average value,low value and poor value in the same industry,the paper gets the conclusion that:(1)JMC is located in forefront of the industry in Economic Added Value and its profitability and asset quality are at the middle level position in the industry,besides its operational capacity and business growth in the industry perform well,ranking advanced level.So the development prospect of JMC is very good and it is also needed to further improve the operating efficiency of assets,save costs and improve the profitability of the company.(2)JMC performs well in customer satisfaction,customer retention and customer profitability,ranking in the forefront of the industry.However,performance in terms of market share and customers rate is just so-so.Thus,the company needs to strengthen the market in the future marketing strategy,make efforts to develop domestic market and foreign markets,take differentiated marketing strategy and brand marketing strategies and establish the company’s brand image,so that makes its brand become a household name.(3)JMC does well in new product development and sales,ranking in the forefront of the industry.Production processes are very advanced and the introduction is all world-class production lines and production management system,besides the products are of high quality too.But the corporate environmental awareness in this regard has not keep up,investment in environmental protection is little,service efficiency is to be improved and aftermarket products troubleshooting rate is also to be improved.(4)JMC’s employee satisfaction and employee retention rate are good and they are in good position in the industry.But overall the investment in staff training is inadequate,which makes development potential limited.The company should enhance staff education and training,so that employees can grasp advanced concepts,knowledge and technology,which helps enhance the company’s long-term competitiveness.Finally,the article gave some suggestion that improves the business performance and implement of EVA-BSC performance evaluation system form the evaluation results,combined with the basic situation of the company,which include establishment of performance evaluation experts team,training of personnel performance evaluation,establishment of performance evaluation and feedback system and strengthen of related incentive system.