Research Proposal on "Performance Measurement for Small Sized Hotel a Balanced Scorecard Approach"

Research Proposal 45 pages (13021 words) Sources: 40 Style: Harvard

[EXCERPT] . . . .

Balanced Scorecard Method

Performance Measurement for Small-Sized Hotel: a Balanced Scorecard Approach

The balanced scorecard approach to the measurement of company performance is gaining popularity. This approach takes into account financial and non-financial aspects of company performance. This research explores the application of the balanced scorecard approach to a small-sized hotel chain in China. The study uses a case-study approach due to the uniqueness of every situation.. The results of the study demonstrate that although, profit margins are thin, the hotel is stable and set for long-term growth.

Case Analysis

Performance Measurement for Small-sized Hotel: a Balanced Scorecard Approach

Introduction

The balanced scorecard is quickly becoming one of the most widely used strategic management system in the business community. The brainchild of Drs. Robert Kaplan and David Norton, this performance metric can be applied a variety of situations and institutions, both large and small (Balanced Scorecard Institute 2009). This performance measurement system recognizes that a company is more than its bottom line. There are many factors that do not appear on the balance sheet that constitute a company's performance. The balanced scorecard approach takes these factors into account, providing a better over-all picture of the company. This research will explore the application of the balanced scorecard method to a small hotel in China. It will use a case analysis approach to the research and will provide recommendations for the performance of the hotel, based on the balanced scorecard analysis.

1.1 Background

The history of the balanced scorecard approach dates back to the 1950s and the work of the General Electric Company for the development of a more accurate performance measurement system (Balanced Scorecard Institute 2009). However, the term "Balanced Scorecard" was not coined until the 1990s. This approach represents a the full spectrum of strategic planning and management. Even in its maturity, the balanced scorecard approach continues to undergo changes in its framework that take it from a passive, broad document, to one that can be put into action on a daily basis within the organization.

One of the key criticisms of the earlier versions of the balanced scorecard system was that it was too broad to be put into action, it was visionary and goal oriented, but the language was too general to produce real-world results (Balanced Scorecard Institute 2009). More recently, the manner in which the balanced scorecard approach is applied has changed, transforming it into a system that produces real results that are consistent with the goals and expectations of the company (Balanced Scorecard Institute 2009).

Clarification of company vision and goals is the hallmark of the balanced scorecard approach. Prior to the balanced scorecard approach, metrics could measure company performance, but they gave no clues as to how to resolve issues, or how to improve performance. The new balanced scorecard approach provides not only a philosophical overview of the company, but results in a plan of action that can be used to develop a plan that can be used in daily management tasks that will result in the company achieving its strategic goals.

A review of the literature reveals that the most common type of research into the balanced scorecard method is the case study that allows the researcher to examine the method in light of its strengths and weaknesses in a particular business setting. The focus of this research is to examine how the balanced scorecard approach can be applied to small hotels in China. In order to accomplish this task we will examine the overall travel and tourism industry in China, as well as the specific conditions that apply to the hotel in question.

The hotel chosen for this study is the Commercial Center Hotel near Jingbo Lake, a natural volcanic tourist site. The Hotel is situated close this world famous tourist attraction near Ning'an City. It is located in Heilongjiang Province, an area rich in tourist attractions. Commercial Center Hotel is only one of three hotels in the city of Ning'an City. Yet, despite the rich opportunity that lays in area tourism resources, performance of the hotel has only been minimal at best. This research will use the balanced scorecard method to assess the strategic position of the hotel, allowing it to capitalize on the rich tourism industry of the area. This research will demonstrate how the balanced scorecard method can be applied to small-sized hotels in China.

1.2 Statement of the Problem

Although this research will only use a single case study, the results will demonstrate how the balanced scorecard method can be used in other small-sized hotels in China. It will examine the problem of how to apply the balanced scorecard method to the hotel industry in general and also how to apply it to small-sized hotels that are similar to the Commercial Center Hotel. The balanced scorecard method is highly subjective and it can be difficult to determine how to apply it in every situation. This research will explore the problem of how to apply the balanced scorecard method to small-sized hotels in China.

1.2 Variable Definitions

This research study differs from the traditional research format where one has dependent and independent variables. Such a strategy would not be likely to answer the research questions in such a way that the results could be applied to other situations that are similar to the one being studied. In this research study, the dependent and independent variables are difficult to isolate due to the subjective nature of the balanced scorecard method and the specific conditions that apply to the hotel in question.

Cast study analysis will provide the most accurate picture of how the balanced scorecard analysis can be applied to small hotels in China, This method will differ from the traditional experimental design, but will provide the best means to answer the research question. This is the most common method found in academic literature for study of the balanced scorecard method and is the most appropriate method for this research study as well.

1.3 Purpose of the Study

The purpose of the study is to determine how the balances scorecard metrics methodology can be applied to small sized hotels in China. The study will focus on one particular hotel chain, but the results can be applied to other small hotel chains throughout China. The primary objective of the study will be to develop a method for applying this method to other small hotels in China, making them more competitive and sustainable in the future.

1.4 Hypothesis

There are several potential hypotheses that could be answered using this research methodology. The first is whether the balanced scorecard method could be applied to small hotels in China. However, this question can be answered by an examination of the balanced scorecard method itself. The balanced scorecard method is highly malleable and can be adapted for use in almost any business setting. It is general enough to be able to be transformed in any business situation.

Rather than focusing on the obvious, this research will focus on the advantages and disadvantages of using the balanced scorecard method to study small hotels in China. The study will examine the following hypotheses, as they relate to this research study.

H1: The balanced scorecard metrics methodology will be shown to be superior to traditional financial-based system in the assessment of Commercial Center Hotel in Ning'an City, China.

H2: The balanced scorecard approach to metrics will prove to be easily applied to other small-sized hotels throughout China.

H3: The balanced scorecard approach will result in a decided competitive advantage over financially-based metrics systems for the Commercial Center Hotel.

These three hypotheses will form the key guidance for the research study. They will serve as the central focus of the research and are directly related to the research goals and objectives.

1.5 Research Questions

The research hypotheses will form the key questions and problems that will be addressed in this research study. However, the extent of knowledge to be gained by this study does not end with these central questions and issues. The study will address many issues regarding both use of the balance scorecard method and how it can be applied to the small sized hotel industry in China. The following research questions will be addressed, in addition to the hypotheses previously mentioned.

1. What are the advantages and disadvantages of using the balanced scorecard method to assess small hotels in China?

2. How can the balanced scorecard approach give small hotels a competitive advantage over other metrics methods?

3. Does the balanced scorecard method provide a means to address specific needs for small sized hotels in China?

Other questions may arise throughout the course of the research that apply to both the Commercial Center Hotel and other small-sized hotels in China. Many of these cannot be foreseen until the case study is underway. These additional questions will be addressed as needed. They will provide valuable insight into the three main research questions and will add depth to the knowledge obtained in this study.

1.6 Significance of the Study… READ MORE

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