| Abstract: | Due to the fact that BSC is a complex system of management, it has its own challenges in measuring the efficiency of the organization from four or more perspectives, and for widening the goals of the organization out of financial and cascade lowering of the strategic goals in order to make day today function of every one in organization. Therefore, This study is designed to assess balanced scorecard implementation practice and challenges in Commercial Bank of Ethiopia (CBE).this study basically focused on BSC implementation, existing performance evaluation system using balanced scorecard, four barrier of balanced scorecard implementation and finally the major achievements of four perspectives of balanced scorecard .the data for this study was obtained through questionnaires that was distributed to 330 employees of the bank working at head office in which only 299 were fully completed and returned. The employees were selected based on stratified random sampling the questionnaire was distributed to the employees on the stratified based on their department. The data collected was analyzed using SPSS version 20 software. The findings of the study indicated that BSC implementation brings improvements on Financial, Internal Business and customer perspectives on the other hand the challenges related to BSC implementation are the performance evaluation system in commercial bank of Ethiopia does not satisfy its to the evaluation system does not employees and fails to differentiate effective performer from non-performer. Targets given to individuals are unachievable and Key performance indicators used in CBE is not significantly measures both individual as well as the organization. As a result of the existing communication system in CBE is not two way communication, employees fail to understand balanced scorecard for better strategy execution. The rewarding system is not linked to individual performance and the benefit package of the bank is not attractive so that the employees’ commitment and motivation is declined. Besides, due to inadequate training program given to employees, their level of understanding about BSC is limited. In addition to this working environment is not suitable for carrier development and improvements. Based on the findings of the study the researcher tried to forward some recommendations so that this will give the bank an insight to the practice and its associated problems of balanced scorecard implementation in CBE.
Keywords: Balanced scorecard, challenge, perspectives, performance evaluation system, target, key performance indictor. |
