Case study: A Fresh Approach of The Balanced Scorecard in the Heathrow Terminal 5 project | Measuring Business Excellence
Introduction
The Balanced Scorecards are used for planning of the administrative frameworks as a key instrument in commercial organizations. The use of this tool has increased in order to tackle the challenges offered by the extraordinary project situations. The case study shows the adaptation of the Balanced Scorecard methodology by the British Airport Authority for their development of the Terminal 5 which was a multi-billion pound project at the airport of Heathrow in dynamic circumstances. The venture of the development of the Heathrow Airport Terminal 5 concentrated on the customary approach of Balanced Scorecard. Given the sensitive nature of the project, the venture also added its additional pointers for management which gave priority to quality, association, benefit and productivity. These additions and conformities made the Terminal as one of a kind making use of the balanced scorecard approach while also being adaptable of using the customer viewpoints in order to compensate the sensitivity of the nature of this project.
Analysis
The Aviation Authority of British has used the balanced scorecard approach for using in the development and overseeing of the Terminal 5 extension at the London Heathrow Airport. The monstrous Terminal 5 extension was very sensitive, and the adaptation of a conventional managerial instrument for such a large project was concerned. However, along with the four main segments of the scorecard approach that are the client, monetary, development and internal business course of actions, the British Aviation Authority altered its structure to make its adaptation more effective. One striking change was how they used it for the commanding of various contractors and builders. Around 120 individuals were used for the balanced scorecard. Out of which most workers were from the consultancy and foreman firms. However, they were required to participate in certain associations in groups which are not very customary in development contracting. The associations of workers required for Terminal 5 was observed and examined while in route to the venture of Terminal 5. The balanced scorecard is made to consider the executive measures as the key pointers which were identified before the project initiated by the members. It enables the members to not only screen their execution, but also enhance any improvements to the execution measures requiring the engagement of the members and considerable changes via the use of decentralized management structure. The communication of the management with the free builders and the securing of the various parameters for the execution and progress were the major lessons gained from the Terminal 5 venture.
Even with the large scale of this project, the balanced scorecard approach allowed the directors to have a very precise focus on tasks. It is an important achievement in itself. The venture was huge with encompassing 50,000 individuals, including the foreman, stakeholders, and representatives. Physically, the terminal size was extended to have 42 airplane stands and aiding in the creation of 30 million travelers per year. The balanced scorecard approach in this respect considered the administration of such scale and showed that it could be applied in various other engagements as well (Murby & Gould, 2009).
The three criteria’s which were implemented included the thoroughness in estimation, meticulousness on purpose, and the thoroughness in the application which instigated the achievement of the framework of the performance administration as upgraded from the Balance Scorecard. The use of a balanced scorecard with the key indicators of performance allowed the members and directors to have an agreed picture of what was most crucial and important across the movement of the project. The learning and development part of the balanced scorecard used the criticism for improving the benchmarks and ensured that the agreement on the guidelines for quality was a priority (Basu, Little, & Millard, 2009)
The British Aviation Authority has issued the interval reports which showed the improvement as considered by the stakeholders of the project. The sample of this can be in December 2007 which showed higher rates of the endorsement of break tasks, meeting benchmarks and financial undertakings. Reporting like this has been the reason that the administration of such huge task with so many stakeholders as possible. Usually, it takes more time than the deadlines and modifications are made, time after to ensure the quality standards of the project. However, with this project, the Terminal 5 venture showed that the use of key performance indicators along with the balanced scorecard could aid achieves such huge success (Mackay, 2004).
Conclusion
With all the things said and done the airport Terminal 5 of airport effectively ensured the managerial and financial achievement of such a grand scale with the use of its key performance indicators and the balanced scorecard approach. The adjusted balanced scorecard showed its appropriateness through the course of the project. It showed that the balanced scorecard approach empowers the communication and associations for tackling any hindrances that may arise in the project and implements a comprehensive scope of the clients in the structure of the company. It reflects on the main parts of the business and shows that reacting in time to the changing business environments, criticisms, and advancement in a business environment can help the project success. The associations were allowed to have a clear procedure, vision and implementation plan provided by the Balanced Scorecard approach. The system works by the workers, stakeholders and the communication and associations among them, and the balanced scorecard and T5 venture showed this effect. Thus, even with the adapted balanced scorecard being different from the convention scorecard approach, it suited well with the project.
References
Basu, R., Little, C., & Millard, C. (2009). Case Study: A fresh approach of the Balanced Scorecard in the Heathrow Terminal 5 project. Measuring Business Excellence, 13(4), 22-33. Retrieved from http://www.perf-ex.co.uk/wp-content/uploads/2012/04/T5-case-study-MBE-papaer.pdf
Mackay, A. (2004). A practitioner’s guide to the balanced scorecard: A practitioners’ report based on: ‘Shareholder and stakeholder approaches to strategic performance measurement using the balanced scorecard’. Retrieved from Chartered Institute of Management Accountants: http://www.cimaglobal.com/Documents/Thought_leadership_docs/tech_resrep_a_practitioners_guide
_to_the_balanced_scorecard_2005.pdf
Murby, L., & Gould, S. (2009). Effective performance management with the balanced scorecard: Technical report. Chartered Institute of Management Accountants. Retrieved from http://www.cimaglobal.com/Documents/ImportedDocuments/Tech_rept_Effective_Performance
_Mgt_with_Balanced_Scd_July_2005.pdf
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