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Journal of Innovative Engineering ElQuliti et al., Journal of Innovative Engineering 2013, 1(1):1

A Hybrid Model for Performance Evaluation and Improvement Using Balanced Scorecards and Analytic Hierarchy Process: The case of Saudi Electricity Company Said Ali ElQuliti*1, Hisham Alidrisi1 and Ayman Mohammed AlYamani2 1 2

Industrial Engineering Department, King Abdulaziz University (KAU), Jeddah, KSA Saudi Electricity Company (DEC), KSA

*

Corresponding author: Said Ali ElQuliti, Industrial Engineering Department, King Abdulaziz University (KAU), Jeddah, KSA; Email: [email protected] Received August 09, 2013; Accepted September 10, 2013; Published October 02, 2013 Citation: Said Ali ElQuliti, Hisham Alidrisi, Ayman Mohammed AlYamani (2013) A Hybrid Model for Performance Evaluation and Improvement Using Balanced Scorecards and Analytic Hierarchy Process: The case of Saudi Electricity Company. Journal of Innovative Engineering 1(1): 1. Copyright: © 2013 Said Ali ElQuliti, et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Abstract The purpose of this paper is to present a hybrid model for performance evaluation using Balanced Scorecards and Analytic Hierarchy Process (AHP) to evaluate the performance of the Western Substation Projects Division (WSPD) in the Saudi Electricity Company. Actually, the current measurement system in WSPD is subjectively depending on individuals and lacking of a scientific procedure to evaluate its performance. While the literature offers plentiful stories about successful applications of the Balanced Scorecard and the AHP, few of them are reported in details. This article provides a detailed logical model for evaluation and improving the performance. The proposed model identifies different strategic objectives related to the four Balanced Scorecard perspectives, which have also been prioritized using AHP. Moreover, the hybrid model also succeeded in identifying the strategic objectives that play the most important role in overall performance measurement. The overall outcomes of this study offer a useful tool to the decision makers to prioritize/ranking different BSC perspectives and their strategic objectives. The final results offer a useful tool for the decision makers to evaluate and improve the workplace from a strategic point of view. Keywords: Performance Evaluation; Balanced Scorecards; Analytic Hierarchy Process; Hybrid Model; Saudi Electricity Company 1. Introduction The Western Region Projects Department (WRPD) is one of the departments of the Saudi Electricity Company; it is responsible for implementing the High voltage (110kV) Transmission Projects procured from other companies. WRPD’s-core role is to manage the power substation projects including their design, progress, costs (price breakdown) and crews. The WRPD is working under the Transmission National Grid Company and has five divisions namely: Planning & Resources Division, Support Facility Projects Division, Western Substation Projects Division, Northern Substation Projects Division, and Western Lines & Telecom Projects Division. The WRPD implementation team is responsible for implementing the project starting from award of the contract up to the project close-out. The team organization is composed of the department manager as the projects head, 5 division managers, senior project engineers (project manager), project engineers and site engineers.

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Most of the organizations – as well as Western Substation Projects Division WSPD- look at their corporate performance by reviewing the financial aspects only. However, financial measures alone are not a balanced view of critical success factors of any organization, mainly because financial measures tend to measure only the past. Also, financial data are mostly derivatives of the result of actions taken in the other three dimensions. WSPD main focus is to accomplish projects on time and within the estimated cost without paying sufficient attention to other factors like learning and growth, customer satisfaction or internal process improvement. Meanwhile, the current WSPD performance evaluation system depends primarily on individual views of managers and lacks a scientific based procedure adopted by successful companies worldwide. Many firms around the world implement their strategies considering the four major perspectives within the Balanced Scorecard (BSC): financial, internal business processes, learning and growth and customer and numerous benefits a firm gained from properly implementing the BSC [1]. Moreover, they define their exhaustive strategic objectives related to the four perspectives and evaluate their priorities and weights using the Analytic Hierarchal Process (AHP). When both BSC and AHP are integrated, a useful guidance can then be provided for practitioners and decisionmakers to perform analysis on BSC perspectives and related strategic objectives by using pair-wise comparisons and have a high degree of confidence in their judgment. By integrating BSC-AHP approaches, the mangers and decision makers can prioritize different BSC perspectives and objectives and determine which plays the most important role in the overall performance in a rational manner. The main goal of this paper is to evaluate WSPD performance evaluation using a combined approach comprising the comprehensive framework of BSC and AHP. The approach starts with establishing a revised WSPD’s mission and vision, creates respective strategic objectives related to the four BSC perspectives, and then calculates their priorities and weights using AHP, establishes the Key Performance Indicators (KPI) to measure and tracked the strategic objectives, and proposes necessary initiatives. Defining the WSPD strategic objectives would assist the WSPD to enhance its internal performance procedures, increase staff loyalty reflecting to their performance, and increase customer satisfaction resulting to WSPD profitability.

2. Literature Review 2.1 Performance Evaluation Systems Using BSC Model Performance evaluation systems have many benefits to organizations, however, usual performance management systems, which are based solely on financial measures, are not enough for exhaustive evaluation. Since 1990, many performance management systems including financial and nonfinancial performance measures have been developed that eliminate this setback and build a balance between financial and non-financial performance measures, and hence, suggests a more thorough evaluation methodology. Through the BSC, an organization monitors both its current performance (finances, customer satisfaction, and business process results) and its efforts to improve processes, motivate and educate employees, and enhance information systems—its ability to learn and improve [2]. Later, new analytical structures are built together with the BSC perspectives, strategic goals and performance criteria. Moreover, many applications and case studies based on information technology solutions are designed based on different analytical structure to demonstrate the steps of the performance evaluation process [3]. In this context, there are many studies and case studies applying BSC approach in performance evaluation systems for decision support at the top management and operational levels. In one public sector study funded by the Sloan Foundation, 70 percent of respondents agreed that their governmental entity was better off since implementing performance measures [4]. The balanced scorecard (BSC) model was introduced by Robert S. Kaplan and David P. Norton 1992 in Harvard Business Review article “The balanced scorecard-measures that drive performance”. The authors discussed a number of possible alternatives for measurement system concerning to add other areas rather than financial area like customer issues, internal business processes, and employee activities. In 1993, Kaplan and Norton ensured that the selected multiple performance measures should be related to strategic goals, in 1996, they suggested that the BSC can be used as a strategic management system, and in 2002, Niven defines the BSC as a performance measures set derived from the business strategy and it has been described as one of the 75 most influential ideas of the twentieth century by Harvard Business Review [5]. BSC is a multi-dimensional model framework that translates a company’s strategy into specific measurable objectives [6], it is an integrated strategic performance management framework that helps organizations translate strategic objectives into relevant performance measures [7].


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The BSC displayed a systematic framework for the performance measurement by integrating financial measures and non-financial measures. The performance measures are determined using the four perspectives which are financial, customer, internal business process and learning and growth perspectives [8]. The BSC model has been successfully implemented in many fields such as the non-profit organizations [9], strategic alliances [10], product design [11], product and market strategies [12] and reverse logistics provider [13], Strategic Planning in a Frozen Vegetable Processing Plant [14]. BSC has been also applied together with other analytic techniques such as AHP [15], fuzzy AHP [16] and Data Envelopment Analysis [17]. The idea behind using AHP approach to find out a simple way to help ordinary managers make complex decisions. The result was the Analytic Hierarchy Process [18]. The basis of the Analytic Hierarchy Process (AHP) is considered as a set of axioms that determine the problems scope [19]. 2.2 Multi-Criteria Decision Making Using AHP AHP is considered as a descriptive model of decision making, it depends on a mathematical structure of regular matrices and associated with ability to generate true or approximate weights. It compares alternatives or criteria, based on pair-wise mode [20]. AHP uses a primary scale of fixed numbers that has been verified in practice by objective and decision problem experiments called Saaty scale [21]. AHP approach achieves pair-wise comparisons among factors or criteria in order to prioritize them at each level of the hierarchy using the eigen value calculation. In addition to AHP, Analytic Network Process (ANP) technique is a general form that allows interdependencies, outer dependencies and feedbacks among decision elements in the hierarchical or non hierarchical structures [22]. The ANP is a generalization of the Analytic Hierarchy Process. Many decisions problems cannot be structured hierarchically because they involve the interaction and dependence of higher level elements in a hierarchy on lower level elements [23]. While the AHP represents a framework with a single-directional hierarchical AHP relationship, the ANP allows for complex interrelationships among decision levels and attributes [24]. The Analytic Hierarchical Process (AHP) has been considered as a solution approach to large, dynamic and complex real world multi-criteria decision-making problems to quantify the factor weights [25,26].The model has been successfully applied to many application fields such as strategic forest management planning [27], timber harvest scheduling problems [28], crop planning [29], integrated catchment management [30], and Geographical Information systems (GIS) [16]. 2.3 A Hybrid BSC and AHP Model AHP is considered as an appropriate technique that prioritizes measure/indicator in BSC approach. In this context, there are many studies that combine BSC and AHP; “Hsing-I Wang and Chien-Chih Yu[28]applied AHP approach that previously proposed by other studies in order to calculate the weight of each criterion/indicators in the AHP tree. The findings gained from the integration of AHP and BSC are to reduce the gap between the findings and objectives, to review the effectiveness of strategies and to make appropriate actions to repair the gaps. Sharam and Bhagwat [31,32] combined BSC and AHP in order to assess the process of Supply Chain Management (SCM). The idea of their work is to propose a method to evaluate the performance of the process within the petroleum industry. They made combination between BSC and AHP to provide a guide for managers in evaluating performance, and measuring the SCM in a balanced way of BSC perspectives. Another research has been conducted by Quintano [33] within the industry of hospitality, the work focused particularly on the highly competitive superior-hotel market. The objective was to increase the validity of the BSC as a performance measurement and management tool by improving it to incorporate hierarchical and prioritization precepts from the AHP. The summary of the work is shows that a hybrid BSC/AHP approach is a better tool than any one of them on its own. Clinton et al. [34] have also combined BSC and AHP to provide a general description of the AHP as metrics for the four perspectives of BSC and what if one of the four perspectives is treated as more important than another. They agreed that the approach can be used to help companies choose appropriate measures and calculate weights of relative importance for both perspectives and measures.


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3. The Hybrid Model Steps The hybrid BSC/AHP model will comprise the following steps as seen in Figure 1:

Figure 1: The hybrid model steps for performance evaluation.

1) Assessment: Collect the possible available data and information related to WSPD, and to assess the existing system for WRPD: performance measuring system. 2) Strategy: Determine suitable mission and vision statements. 3) Objectives: State the strategic objectives within the framework of the four perspectives of BSC. 4) Strategic Map: Design suitable strategic map using the cause-effect links which connect each objective that cause an influence on the achievement of another one with an arc. 5) Performance Measures: Formalize suitable Key Performance Indicators (KPI) and targets. 6) Initiatives: Create required programs for achieving all the strategic objectives. 7) Ranking/Prioritize the BSC perspectives and the Strategic Objectives: Use the Analytic Hierarchal Process (AHP) to find out BSC perspectives and strategic objective priorities.

4. Developing the WSPD Mission and Vision Several steps are performed to develop both the WSPD mission and vision based on the Mission Expert Software developed by the Kinetic Wisdom, Inc. [35] and the operating procedure manual for the department [36]. The Mission Expert software is a new solution for creating and installing an effective mission statement in an organization. It is based on a straightforward proven methodology delivered in an engaging multimedia format and includes all of the templates and tools needed to accomplish the process. It comprises also a visioning workshop module that includes an animated tutorial that shows how to conduct the session along with a Vision Collector utility that automates the creation of the materials needed for the meetings. The exclusive Mission Statement Creator helps to easily construct the first-draft mission statement. The mission and vision statements are developed through the following steps: 1) Selecting Team Members: Select the appropriate expert team with strategic views to develop the individual tasks (mission, vision and strategic objectives). 2) Declaring the top level perception and goals: The team declares clearly the perception of WSPD purpose, and outlines the top level goals. 3) Brainstorm Meetings: The team performs frequent meetings to brainstorming the formal and informal activities of the division (rules, customer expectation of division, laws and responsibilities), and for thinking about what the WSPD is dedicated to.


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4) Creating Possible Statements: The team is asked to create possible mission and vision statements, taking into consideration the general Saudi Electricity Company mission and vision statements. In this concern, any appropriate phrase or idea that comes in mind is recorded. To help doing the task, the team performed a workshop and reviewed some good practical examples for some international companies as a guide line. 5) Answering Important Questions: Each of the required statements should accurately explain some important questions related to the considered division and to SEC as a whole. The prime questions to create the WSPD mission statement are: what is the main purpose of the division? What are we doing to address these needs? And what the principals guide our work? The prime questions to create the WSPD vision statement are: What the division wants to become? What it hopes to look like in the future? “ 6) Drafting a List of Statements: As a starting point, the team utilizes the Mission Expert Software to create a first draft of the division mission statement using the modeling tool “Mission Statement Creator” by filling the answers to each of the specific questions to generate a draft mission statement. (We make use of the Mission Statement Creator that generates four mission statement proposals, so that the team can create one as a final draft statement). 7) Selecting the Final Statement: The team then makes the necessary amendment to obtain the final WSPD statements. The final mission statement is: “To supervise the implementation of projects, facilities and power transmission according to the specifications and quality engineering applied within the company and within the cost and timetables to using them for supporting the network and meet the needs of the electrical system”. The final vision statement is: “To be recognized as the best division for transmission project development, implementation, and servicing in National Transmission Grid Co”. Figure 2 (left part) shows a flowchart for the main steps in mission creation.

5. Developing the Strategic Objectives and Strategic Map In view of the general steps used to develop the WSPD vision and mission statements, and the general steps outlined to generate the strategic objectives in the process of elaborating the Balanced Scorecard for a strategic business unit of the ABB Industrie AG Co. [37], several steps are proposed to develop the WSPD strategic objectives. These steps are the following: 1) Drafting Proposed Strategic Objectives: Several workshops were planned including representatives from different areas in the company. Each individual member is assigned the task of finding out the strategic goals from his opinion. 2) Strategic Objectives Identification: The primary task in this step is to ensure that all points of view are taken into consideration and the proposed strategic objectives are identified and properly phrased. 3) Assign Strategic Objectives to BSC Perspectives: In this step, each of the identified strategic goals is assigned to the corresponding BSC perspective: The shareholders’ interests are taken into account in the financial perspective, All units relate to the customer dimension like the maintenance department, the distribution company and major senior participants needs serve as basis for choosing the strategic goals of the customer perspective, The internal processes perspective is directed at objectives related to all activities within the Department itself like: process safety measures, task procedures leading to closing time, and possible improvements to the processes. The learning and growth perspective refers to constant improvement concerning employee qualification and information management.


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Some guidelines for assigning the objectives to different BSC perspectives should be taken into considerations to establish “linkages” as follows: The goals in the customer perspective should support the achievement of the financial goals; The goals in the internal process perspective should be in direction with customer goals and to those of shareholders; The goals in the learning and growth perspective should serve the achievement of the goals in the other three perspectives. 4) Bring Together Individual Works: The task in this step is to bring together all the individual works and to choose among similar objectives the most critical ones. 5) Selecting Process: A special workshop is performed to examine the identified objectives with regard to their strategic significance. The top-down approach was used starting with the financial perspective and proceeding through the customer, internal process, and learning and growth perspective. 6) Filtering Process: To select final goals the following filter criteria were used: A strategic objective that comprises a competitive advantage is chosen. A strategic objective which has a possibility to achieve the required targets is selected. The availability of expertise and competencies to fulfilling each of the strategic objectives is a selection criterion. The availability of the requirements for measuring and monitoring each of the strategic objectives is a selection criterion. The availability of the required resources to achieve each of the strategic objectives (e.g. financial or management capacity) is a selection criterion. 7) Final Strategic Objectives: Finally all the goals were selected based on full team consensus and arranged according to the Balanced Scorecard perspectives. Figure 2 (right part) shows the steps for developing the WSPD vision, mission and strategic objectives.

. Figure 2: Steps for developing WSPD vision and mission statements and strategic objectives.

Figure 2: Steps for developing WSPD vision and mission statements and strategic objectives.


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The final WSPD strategic objectives are stated as follows: A. Financial Perspective. 1. To maximize the profit of project implementation (Profitability). 2. To maximize the profit of supervising outsourcing projects (Outsourcing). B. Customer Perspective. 3. The project quality and services are executed according to standards. (Quality). 4. Project prices do not exceed the contracted value (Price). 5. Projects are executed and handed over on time (Timing). C. Internal Business Processes Perspective. 6. To improve WSPD procedures (Improvement). 7. To close projects financially within 4 years (Closing). 8. WSPD systems are running in a safe mode (Safety). D. Learning and Growth Perspective 9. Our employees are competent and motivated (Motivation). 10. Our employees are well learned about related fields (Training). The interrelationship framework among the different strategic objectives in the four BSC perspectives is prescribed in the Strategic Map as shows in Figure 3.

Figure 3: The strategic map for strategic objectives interrelationships. The map links each of the perspectives, and attempts to graphically depict how performance of one measure in a perspective category will affect a measure or measures in another perspective, while all improvements should be


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mapped to the organization’s business goal or vision [38]. These cause and effect relations aid in developing the necessary initiatives to realize WSPD development in various perspectives. The strategic map has 15 links that represent the interrelationships between different strategic objectives. For example link 1 relates the training of WSPD employees in related fields by providing the up-to-date and competent courses with increasing the loyalty and motivation of employees. In link 15, closing projects financially will maximize the total profit. Closing projects on time will decrease unexpected additional working hours and efforts, and will permit projects to be completed within the planned budget and definitely will decrease the operating expenses.

6. Developing the WSPD Measures and Targets For each strategic goal, one or more KPI(s) and associated target(s) have been developed in order to monitor the achievements of the strategic goals. The perspective Saudi Electricity Company (SEC) experts proposed a total of 20 KPIs to cover all the stated strategic goals taking into considerations to satisfy the relevant important characteristics [39]. The proposed KPI’s for the four BSC perspectives and their targets are shown in Table 1. Table 1: The WSPD proposed KPIs and targets.

15 16 17 18 19 20

Financial Customer

2 3 4 5 6 7 8 9 10 11 12 13 14

Business process

1

Perspective

Learning & Growth

No

KPI

Target

Average operating profit (maximizing revenues and minimizing costs) to total value of capital projects. Number of contractors. Number of manufacturers. Averages supervising cost to total supervising Value. Number of deviations from standards. Number of change orders. Number of customer inquiries during one year from handing over. Number of punch list items for each project during handing over Changing order prices for bulk customers. Percentage of projects handed over without change order in a year Percentage of invoices returned to WSPD due to error. Percentage of Projects handed over on time Forming a team for procedure review each year. Innovation/ improvement of procedure during a year. Percentage of closed projects financially according to FAC & FRRA Number of injuries/accidents Number of training days for each employee.

≥ 10 %

Average working load. Number of promoted employees. The number of training courses.

≥4 ≥4 ≤ 40 % ≤ 1/ Project ≤ 1/ Project ≤ 5/Project ≤ 30/Project ≤5% ≥ 90 % ≥ 10 % ≥ 90 % Yes Yes ≥ 75 % ≤ 5/ year ≥ 15/ Year ≤ 2 projects/ employee ≥ 2/ Year ≥ 20/ Year

The main characteristics of the KPI’s containing: Source, Measures, Target, Method, Responsible Owner, Frequency and the person who undertake the corresponding KPI are shown in Table 2.


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Table 2: Main characteristics of the KPI’s Average operating profit to total value of capital projects.

Number of contractors.

Number of manufacturers.

Averages supervising cost to total supervising Value.

WSPD

Standard and Spec. Department


Planning & Resource Division

Average

Qualified Contractors

Qualified Manufacturers

Supervising Cost & Values.

10 %

4

4

40 % from Supervising Value

`Review & Report

Approved List

Approved List

Review & Report





Quarterly

Quarterly

Quarterly

Quarterly

Planning engineer

Planning Engineer

Planning Engineer

Auditor

Undertaken by.

Frequency

Responsible Owner

Method

Target

Measures

Source

KPI

7. Developing the WSPD Improvement Initiatives This is the last BSC workshop in order to find out the required programs for achieving each strategic goal. Each team member had the task of finding out at least one program for each strategic goal. The next step is to bring together all individual works and based on full team consensus selecting the programs with regard to their feasibility of implementation and their support of a goal, they are: 1. Training and job rotation. 2. Reviewing 3. Coordination


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4. 5. 6. 7.

Work Improvement Motivation Development Expertise Safety.

Table 3 shows the matrix of relations between initiatives and strategic objectives, the relation is shown by the sign in place where an initiative will have an effect for achieving the corresponding strategic objective. Table 3: Initiatives and Strategic Objectives Matrix.

Customer

7- 8- Safety

7- Expertise

6- Motivation 6-

5- 5- Improvement

4- 4- Coordination

√ √

2- 2- Outsourcing. 1- 3- Quality.

√

√

√

√

√

√

√

√

√

√

2- 4- Pricing 3- 5- Timing. √

1- 6- Improvement. Learning& Internal Growth Process

3- 3- Reviewing

1- 1- Profitability.

2- 2- Training

Financial

Strategic Objectives

1- 1- Job Rotation

Initiatives programs

√

2- 7- Closing. 3- 8- Safety.

√

1- 9- Motivation.

√

2- 10- Training.

√

√

√ √ √

√

Some details for initiative program number 1 (Job Rotation) are shown in Table4.

8. The AHP Model and Results The AHP was applied on the developed BSC framework. It is a suitable framework for this application since it represents a single-directional hierarchical AHP relationship. The combination between BSC and AHP approaches is shown in Figure 4. The aim is to prioritize the four BSC perspectives by calculating the relative weights in order to find out which perspective is more important than others for achieving the WRPD vision and mission, as well as by calculating the weights for each developed strategic goal using the appropriate Analytic Hierarchical Process (AHP) or Analytic Network Process (ANP). Based on that, top management can focus on the most important strategic goals.


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Table 4: Job Rotation Program. Initiative name: Training & Job Rotation Program Initiative Definition: It is concerned with developing capabilities, skills and knowledge of all the WSPD new employees in all related areas in the department in order to do their duties in the right and good manner. This is done through training those employees in all the major activities within the department in turn, this will assist to achieve the WSPD strategic goals. Objectives: Safety: WSPD systems are running in a safe mode. Motivation: WSPD employees are competent and motivated. Training: WSPD employees are well learned about related fields. Target Segment: WSPD new employees and fresh graduates in the Professional Developing Program. Responsible for Implementation: Planning and Recourse Division. - West Substation Project Division. -Training centre. Cooperating Community (Members or sections): SEC training centre. Approved Outsourcing training centers. Supervisory Authority: West Substation Project Division Manger. Planning and Recourse Division. SEC training centre. Weaknesses: Lack of loyalty to the division or company Increased number of injuries and accidents at work. Lack of experience of new employees. Unfamiliarity of new employees with relation work with other departments. Unfamiliarity of new employees with general progress. Weak cognitive and functional development for employees. There are some difficulties in internal and external work procedures or workflow. Strengths: Encouragement of high management for the program. There is a specific budget for training for each division. Main activities: Well preparation for Training according to the capacity requirement plan one year in advance (Planning and Resources Division). According to performance annual assessment for WSPD employee, identify weaknesses point’s needs to strengthen (WSPD Manger). Identify required training courses and account the budget (P& R Division). Prepare training plan schedule for WSPD employee (WSPD Manger). Coordination with SEC training centre for the courses (P& R Division). Contracting with outsourcing training centers for not available courses (P& R Division). Prepare rotation plan for new employees (WSPD Manger). Coordination with concerned Dep. /Division to facilitate their rotation (WSPD Manger). Follow up the fresh graduate employee during their rotation (WSPD Manger). Quality Assurance: Close monitor to trainee during training courses and PDP during job rotation. Quarterly reports about training courses have been taken as per planned training schedule. Implementation Frequency: Every year. Time Duration: 48 Weeks. Estimated budget: 80,0000 Saudi Riyals.


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Figure 4: Combination between BSC and AHP approaches. The questionnaires were distributed and filled up by the participants. The response rate was 100%. Each questionnaire was analyzed using “Super Decision” Software [40] (for the 10 participants).The Super Decisions software implements the Analytic Hierarchy Process, AHP, based on deriving priorities by making judgments on pairs of elements, or obtaining priorities by normalizing direct measurements. Figure 5 a) and b) shows two samples from the Super Decisions Software outcomes: BSC perspectives and objectives weights. In order to ensure the consistency of the response, small adjustments can be automatically provided by the Software to reduce the inconsistency ratio.

9. Conclusions, Difficulties and Points for Future Researches The main conclusions of this study can be summarized in the following points: 1) While the literature offering plentiful statements about successful introduction of the Balanced Scorecard and the Analytic Hierarchy Process, few reports of detailed experience are available.

Figure 5: a. Software outcomes


b. BSC perspectives and objectives weights.

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Table 5: Ranking the BSC perspectives and the strategic objectives. Rank

BSC Perspectives

Weight

1

1- Financial

0.28574671

2

4- Learning & Growth

0.2652269

3

3- Business & Process

0.23013378

4

2- Customer

0.21889262

Rank 1 2 3 4 5 6 7 8 9 10

N0., Strategic Objectives 1- Profitability. 9- Motivation. 10- Training 7- Closing. 2- Outsourcing. 5- Timing. 8- Safety. 4- Pricing. 6- Improvement. 3- Quality

Weight 0.204451584 0.148744011 0.118612273 0.109328754 0.097063358 0.087312709 0.065460991 0.062012906 0.054145549 0.052867865

2) Several steps are performed based on the general procedure in the Mission Expert Software to develop the WSPD mission statement. The experiences gained from developing the mission, from other institutions and from the continuous and painstaking mental effort of assigned experts are utilized to develop the WSPD vision, strategic objectives, measures, targets and initiatives. 3) The proposed BSC/AHP approach provides a balanced performance evaluation system and it helps WSPD to monitor its performance. It also helps WSPD to improve its internal and external functions of business. The AHP was applied to prioritize BSC perspectives and its strategic objectives. 4) A total of 10 strategic objectives are formulated, of which 2 or 3 in each one were employed in the BSC perspectives. A total of 20 KPI’S and their associated targets are developed: 8 for the objectives in the customer perspective, and 4 for each of the other 3 perspectives, and 7 Initiative programs are designed to achieve the required strategic objectives. 5) While the financial perspective gained the highest priority relative to the other three ones, the differences in weights obtained by the four perspectives are too small to be considered as a vital issue for differentiation. This result shows that all the four dimensions for this specific application are equally important, hence balanced. 6) Among the 10 strategic objectives, the highest priority was assigned to profitability (20.445%), followed by motivation (14.87), training (11.86%), and closing time (10.93%). All other strategic objectives obtained priorities of less than 10%. The smallest weights were assigned to the pricing (6.20%) and quality (5.29%). 7) The proposed approach provides a template for a strategic decision making process by which the WSPD decision support system can implement an improvement performance evaluation and development. The main research remarks, limitations and difficulties are summarized in the following points: 1) As expected, long time was required to fulfill the task of BSC by the BSC-team. Many “full-day” workshops were formed just to introduce the concept of BSC and its elements. Each workshop was extended to additional two or three days for preparation and review. The whole process of developing the BSC took about six months. 2) BSC tasks required more professional/managerial skills than expected. 3) Some difficulties occur in regard to defining KPI’s for financial perspective objectives. To overcome these difficulties, the BSC-team was encouraged to create possible measures. 4) The guidelines for targets and measures were insufficient. The BSC-team tried overcoming this difficulty by considering the interdependencies between the objectives when quantifying the values of the measures to be attained each year.


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The main points for future researches are summarized in the following: 1) Future studies might provide prioritization for WSPD’s KPI’s, targets and initiatives mentioned in this study and perform a comprehensive decision support tool for the institution. 2) In order to obtain an overall performance evaluation for the whole company, such a study is applicable for the other four divisions (P&RD, SFPD, NSPD and WL&TPD). 3) The proposed hybrid BSC/AHP model can be extended to include fuzzy logic, which in turn provides a chance for comparing the results of the two (or more) studies. 4) To apply other forms of MCDA for the same application and compare the obtained results with those of the AHP.

References: 1. 2.

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18. Patel B, Chaussalet T, Millard P (2008) Balancing the NHS balanced scorecard. European Journal of Operational Research 185: 905-914. 19. Forman EH, Gass SI (2001) The analytic hierarchy process – An exposition. Operations Research 49: 4469-486. 20. Abu Samah MA, AbdManaf L, Zukki NM (2010) Application of AHP Model for evaluation of solid waste treatment technology. Int. J. Eng. Tech. Sci 1: 35-40. 21. Coyle G (2004) The Analytic Hierarchy Process (AHP), Practical Strategy, Open Access Material. Pearson Education Limited. 22. Görener A (2012) Comparing AHP and ANP: An Application of strategic decisions making in a manufacturing company. International Journal of Business and Social Science 3: 11. 23. Saaty TL, Özdemir MS (2005) The Encyclion: A Dictionary of decisions with dependence and feedback based on the Analytic Network Process. RWS Publications, USA. 24. Yüksel İ, Dağdeviren M (2007) Using the analytic network process (ANP) in a SWOT analysis-A case study for a textile firm. Information Sciences 177: 3364-3382. 25. Kaplan RS (2001) Strategic performance measurement and management in non-profit organizations. Nonprofit Management and Leadership 11: 353-370. 26. Render B, Ralph M, Hanna ME (2011) In: Quantitative Analysis for Management. (11thed), Pearson, Printice Hall, London, UK. 27. Kangas J (1994) An approach to public participation in strategic forest management planning. Forest Ecology and Management 70: 75-88. 28. Diaz-Balteiro L, Romero C (1997) Modelling timber harvest scheduling problems with multiple criteria: an application in Spain. Forest Science 44: 47-57. 29. Mainuddin M, Gupta AD, Onta PR (1997) Optimal crop planning model for an existing groundwater irrigation project in Thailand. Agricultural Water Management 33: 43-62. 30. Itami R, Cotter M (1999) Application of analytical hierarchy process to rank issues, projects and sites in integrated catchment management. Proceedings of the 2nd International Conference on Multiple Objective Decision Support Systems for Land, Water and Environmental Management (MODSS'99), Queensland Department of Natural Resources and Mines, Brisbane, Australia. 31. Wang HI, Chien-Chih Y (2011) Measure the performance of reducing digital divide – the BSC and AHP Approach. Journal of Computers 6: 389-396 32. Sharma MKR, Bhagwat R (2007) An integrated BSC-AHP approach for supply chain management evaluation. Measuring Business Excellence. 11. 3. 33. Quintano A (2012) Performance evaluation in the hospitality industry: the balanced scorecard and beyond. University of Malta. 34. Clinton BD, Webber SA, Hassell JM (2002) Implementing the balanced scorecard using the analytic hierarchy process. Management Accounting Quarterly 3: 31. 35. http://mission-expert.software.informer.com/. Accessed on January 10, 2012. 36. Saudi Electricity Company (1988) Operating procedure manual for consolidated transmission area projects department. Project study No. IE 18-07-43-18. 37. Heinz A (2001) Applying the balanced scorecard concept: An Experience Report. Long Range Planning 34: 441-461. 38. Hoehn WK. Managing organizational performance: Linking the balanced scorecard to a process improvement technique. Raytheon Systems Company, Tucson, Arizona. 39. http://ianjseath.wordpress.com/2009/08/26/lead-vs-lag-indicators/. Accessed on February 10, 2012. 40. http://www.superdecisions.com/. Accessed on February 15, 2012.


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