Volkswagen Balanced Scorecard:

The balanced scorecard looks at the financial performance of a company and how it has improved, as
well as customer relations, internal business processes and learning and growth. It looks at the past
performance of a business to predict and drive future performance (Kaplan & Norton, 1996, p8). A
balance scorecard can help. VW to find their vision and strategy, by understanding their financial
goals, how to serve their customers, and by figuring out what internal business processes are
important for providing value to the customers. The balanced scorecard looks at cause and effect, so
if they improve on one sector, how will it benefit another. For example, if VW improves their learning
and growth, they will also improve their customer sector, meaning they sell more cars, in turn
leading to more profit in the financial sector.
VW may look to improve their balanced scorecard by looking into hybrid cars. By hiring people with
the knowledge on hybrid cars and how to make eco-friendly cars, they can innovate in a new area
where competitors have the advantage. By hiring employees who are more skilled in hybrid cars,
they will increase their learning and growth, which in turn will have an advantage for internal
business processes as they will have the options to produce hybrid cars. This will then increase their
customer satisfaction, which means they will sell more cars, make a higher profit per car, and have an
increased overall net profit (appendix 8).

Kaplan, R.S & Norton, D.P (1998). The Balanced Scorecard: Translating Strategy into
Action. Harvard: Harvard Business Review. p8.

Appendix 8

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