Samples Customer Comparison between the T5 BSC and the Standard BSC

Comparison between the T5 BSC and the Standard BSC

995 words 4 page(s)


The Balanced Scorecard was invented by Kaplan and Norton in 1992 and developed through to 1996 for it to help the corporate businesses measure their performance by analyzing actions of the workers and the results of the actions (Murby & Gould, 2005). The performance measurement model was based on four major elements including, the financial, customer, internal operations, and learning and growth elements of an organization (Martello, Watson, & Fischer, 2016). This model was mainly used by for-profit organizations to monitor their financial progress and help them make crucial decisions about the same. It was, however, not originally meant for the operational industry and manufacturing sectors. Therefore, for any such company that wishes to use the model to measure its performance, it has to modify the original one by Norton and Kaplan so as to fit their needs just like the Terminal 5 project in Heathrow Airport. The reason this model would not be common with the operational industry is the fact that it aims at balancing aspects of a business that are not so much favored by managers like financial and non-financial factors (Basu, Little, & Millard, 2009). This paper aims at comparing the original version of the balanced scorecard model and the customized one used by T5 project.

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T5 project used the original idea of a balanced scorecard to come up with a customized one to fit the project management. In order for it to be successful, they made sure that it is strong in purpose; aligns with the company’s objectives in every aspect of the balanced scorecard, is well monitored; using efficient methods of data collection and metrics to measure their performance, and finally strict application of the findings of the Balanced Scorecard (Basu, Little & Millard, 2009). T5 has customized the Balanced Scorecard elements into a “performance management system” and all the elements are fully represented, although they may not directly relate (Basu, Little & Millard, 2009). Key Performance Indicators (KPI) help companies set achievable goals, as well as strategies to achieve them (Taylor, 2017).

Financial Focus
The financial element in the traditional Balanced Scorecard shows the need for profit organizations to find means of increasing revenue and through more productivity and improved quality of products. However, in T5 project, this is represented by the “Benchmarks Agreed” performance indicator that will be achieved by organizing financial benchmarks. Another PI for the financial focus is the “compliance assurance” factor that is measured by costs of different sub-projects in air, road, and rail project.

Customer Focus
Customer element in Norton’s and Kaplan’s Balanced Scorecard refers to the relationship and management of customers, the value for their money, prices of products, and service provision (Martello, Watson, & Fischer, 2016). In the T5 project, the customer aspect was represented by the “handover agreed and work handled” as indicated by the project manager. The delivery that is agreed upon with the customer as well as the amount of service and work done to take care of the customers measures this specific element as in the traditional BSC.

Learning and Growth Element
The learning and growth factor in the original model of the Balanced Scorecard means the expansion of skills and technological advancement in an organization. This includes most of the intangible elements in a workforce like motivation and satisfaction. On the other hand, in the T5 project, the KPI used to represent this factor is “Benchmarks Agreed” where the workers will be holding workshops to improve their skills (Basu, Little & Millard, 2009). Another enabling factor in this KPI is “work supervised and verification planned” under which the supervisors of the projects will offer training to the employees gradually.

Internal Operational Processes
The Norton’s and Kaplan’s original model of the Balanced Scorecard includes this element that determines the financial and customer outcomes for the company. The internal processes directly relate to the strategies and the consequences, and are supposed to be drafted carefully. For the T5 project the KPI metric that represented this factor was “Inspected and Protected” which meant that the working conditions of the employees were inspected by safety assurance and they were all protected under the workers’ rights. This gives them a good working environment for safe and maximum production, including health insurance and insurance against any accidents while working on the project. Another metric for internal processes was “Compliance Assured” which shows that the project was being operated under the guidelines and policies of construction and running a terminus. These policies aim at ensuring proper management of resources, protection of consumers, and for the benefit of the whole country.

The Terminal 5 project at Heathrow Airport in London is the largest in the transport sector in the world. The project, however, for it to be successful, needed a way to measure the performance in each construction step and guide decision making for project managers. The best model for project management that was chosen was the Balanced Scorecard by Kaplan and Norton, which uses four major factors; financial, customer, learning and growth, and internal operations. However, this model would not suit this huge project and had to be modified to fit their needs. This gave rise to the Key Performance Indicators (KPI) that were aligned with the objectives of the project, closely monitored during implementation, and results applied for improvements. The T5 project’s use of the BSC proves that any industry or company can use the model for performance measurement when customized according to the needs of the particular industry.

  • 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. doi:10.1108/13683040911006765
  • Martello, M., Watson, J. G., & Fischer, M. J. (2016). Implementing a balanced scorecard in a not-for-profit organization. Journal of Business & Economics Research (JBER), 14(3), 61. doi:10.19030/jber.v14i3.9746
  • Murby, L., & Gould, S. (2005). Effective performance management with the balanced scorecard: Technical report. Chartered Institute of Management Accountants. Retrieved from
  • Taylor, J. (2017) What is a KPI, Metric or Measure?. Retrieved from