Controlling and Berlin Balanced Scorecard Approach

Transcription

1 Controlling and Berlin Balanced Scorecard Approach by Prof. Dr. Wi I helm Schmeisser Dipl.-KfFr. (FH) Lydia Clausen Dipl.-Kffr. (Univ.) Rebecca Popp Dipl.-Kfm.(Univ.) Carsten Ennemann and Olaf Drewicke with the collaboration of FalkoSchindler NicoHonighaus Frank Herbrechter and Edith Teschner Oldenbourg Verlag Munchen

2 Contents Abbreviations XXI Chapter I 1 Preliminary thoughts: Controlling with the aid of the Berlin Balanced Scorecard as Performance Measurement approach in companies 1 1 Performance Management Basics 1 2 Traditional Performance Measurement Concepts as predecessor of the BSC DuPont system ZVEI-ratio system Profit-Liquidity-ratio system Critical appraisal of traditional Performance Measurement concepts 14 3 BSC - an ideal and practicable, modern Performance Measurement concept 15 Chapter II 19 About the issue of the use of the Balanced Scorecard as Controlling Instrument within a value oriented business management 19 1 Starting point and problems concerning the Balanced Scorecard 19 2 Basics of controlling with the help of Balanced Scorecard Overview over Strategic Management and Controlling Approaches regarding Strategic Management and Controlling About the Strategic Management Process Past management trends Total Quality Management (TQM) Business Process Reengineering (BPR) Management by Objectives (MbO) Existing management problems Balanced Scorecard as a solution for the performance measurement topics 31

3 XIV Contents 3 Balanced Scorecard as Strategic Management Instrument Conception of the Balanced Scorecard The four generic perspectives in accordance with Kaplan/Norton Financial Perspective Customer orientation Perspective of internal processes Perspective of learning and development About the strategy implementation with the Balanced Scorecard Formulation and implementation of vision and strategy Communication and coordination of strategic aims and measures Planning, determination of objectives and coordination of strategic initiatives Strategic Feedback and Learning Implementation of the Balanced Scorecard Course of action Success factors > Experiences of implementation Strengths and weaknesses of the concept 56 4 Indicators and indicator systems as first necessary step Terminological basics about indicators Indicator types Cardinal numbers Ratios Ratio systems as Performance Measurement About the Du Pont-ratio system The ZVEI-ratio system The profit-liquidity ratio system Evaluation methods : Static analysis Comparative Analysis Generic problems with the use of indicators 66 5 Balanced Scorecard as indicator system ' Use of strategic indicators Determination of a well-balanced indicator mix Well balanced proportion of early and lagging indicators Balance between financial and non-financial indicators Indicators connected through cause-effect chains Cause-effect relations of the BSC About the generation of causal relations 75

4 Contents XV 5.4 Indicators of the particular Balanced Scorecard perspectives Financial perspective Customer Perspective Internal process perspective Learning and growth perspective Application Problems 94 6 About the calculability of the Berlin Balanced Scorecard Approach Illustration of and connection between customer perspective and financial perspective Contribution margin accounting as earning analysis in the customer perspective Return of Investment as parameter of the financial perspective From the customer to financial perspective via contribution margin analysis Calculability of the internal process perspective and connection to the potential and financing perspective Quantification of the internal process perspective via analysis of value creation Productivity as parameter for economic efficiency Connection of finances with internal business processes and internal potentials through value creation \ Connection of the customer perspective with the potentials via an optimal production program in the case of given capacities Closing words Literature 111 Chapter III 121 Quantification of the potential perspective, employee perspective or of human resources in the context of the Berlin Balanced Scorecard without cost-utility analysis Cost and capitalized value-oriented quantification Differentiation of relevant costs Salaries and wages Absenteeism Fluctuation Employee suggestion system External labor costs Costs of material Interests and similar expenses Administrative costs and costs of distribution 133

5 XVI Contents 2 Calculation of a contribution margin per employee Interpretation of the employee contribution margin Extrapolation to the employee cash flow Investments appraisal based aggregation Determination of the discount rate Possibilities of usage and interpretation of results Indicator hierarchy of the Berlin Human Capital Assessment Model Conclusion and outlook Literature 141 Chapter IV 147 Berlin Human Capital Assessment Model exemplified with football player values with benefit analysis Introduction Side note: previous considerations on the controlling logic in the area of human capital Soccer associations Legal basis Reasons for a transformation Externalization of the contract player department Legal steps of externalization Possible legal forms and their advantages and disadvantages Example of the structure of a soccer capital corporation Revenues and expenses of soccer associations Sources of income TV revenues Merchandising structure Spectator revenues Jersey advertisement Merchandising Expenses Stadium rent 168

6 Contents XVII Player remunerations Other operational expenses Identification of player capacity on the balance sheet Definition: Intangible assets Side note: Principle of entry as asset in accordance with the HGB (German Commercial Code) Examination of the possibility of entry of player abilities under IAS Abstract possibility of entry as asset Concrete possibility of entry as asset Self-created immaterial assets Booking conditions in accordance with the HGB Booking conditions in accordance with IAS/IFRS Evaluation of access to "intangible assets" Hand money or "Signing Fee" Player agent and commission Purchase tax related dealing with the purchase payment and the agency commission Subsequent valuation of the "Intangible Assets" Systematic amortization Extraordinary depreciation Appreciation Contract term Contents of labor contracts Formation compensation Transfer Fee Special presentation of player values in the balance sheet Interim conclusion Balanced Scorecard Definition Composition The seven central ideas of the Balanced Scorecard Standard Model Vision Mission Strategies The four target perspectives Cause-effect relations 206

7 XVIII Contents 7 Case study: Balanced Scorecard illustrated with a soccer club Frame conditions Venues, administrative panel and specialties Club team Structure of revenues and expenses Balanced Scorecard of the "FC Hagen 09 e.v." Company strategy Financial perspective Customer perspective Internal process perspective and employee perspective Sportive perspective Cause-effect relations Scenario Sportive targets Internal process and potential perspective Case study: Application of the Berlin Balanced Scorecard Application of the Berlin Balanced Scorecard Assessment of the player performance Assessment of the additional value Determination of the player value Connection of the player with the financial perspective : Conclusion Literature and sources 247 Chapter V 261 Value increasing performance control with the help of the Berlin Balanced Scorecard Approach: Further Development of the financial perspective via the capital flow calculation and the Working Capital management Introduction Cash Flow Statement Basic principles for establishing a Cash Flow statement Special questions of attributions Structure of the Cash Flow statement Cash flows from operative activities Cash flows from investing activities 268

8 Contents XIX Cash flow from financing activities About Working Capital Determination of the Working Capital About management of Working Capital Tasks of Working Capital Management Management of receivables Management of inventories Management of liabilities Control of Working Capital Effects of the Working Capital management Interactions between Working Capital and Cash Flows Interactions between Working Capital and ROI The connection of Shareholder Value, Cash Flow Statement and Working Capital with the Berlin Balanced Scorecard Determination of the adequate target rate Mathematical connection of SHV, Cash Flow Statement, WC and BSC Management of the operative Cash Flows Management of Cash Flows from investing activities Management of Cash flows from financing activities Conclusion Literature Closing words and outlook 285