Research On Performance Evaluation System For Shanxi Jinzhong Development Zone Rural Credit Cooperatives Based On Balanced Score Card

ABSTRACT：Proposed by Kaplan and Norton from more than20yearsago, Balanced Score Card is an essential strategy management tool for a lot ofenterprises, who had paid excessive attention to only financial indicators. Itprovides comprehensive management techniques for the enterprise, includingcustomer feedbacks, business updates, product quality guarantee, businessconcept innovation, technology upgrade, staff consciousness and abilityevaluation, ratio of tangible to intangible assets, investment in the future. Infinancial sector, in the face of fierce competition from both inside the industryand outside, financial indicators performance evaluation is outdated. The fourperspective approach of the balanced score card, including financial, customer,internal business processes, and learning and growth, provides an effective toolto compensate for the deficiency of the traditional performance evaluationmethod.In this paper, the authors use Shanxi Jinzhong Development Zone RuralCredit Cooperatives Association as an example, in order to build an improvedperformance evaluation system combined with financial indicators andnon-financial indicators and balancing the short-term performance andlong-term strategy, with approach of qualitative and quantitative, andcomparative analysis. Thus the necessity and feasibility of introducing thebalanced scorecard into the performance evaluation system of JinzhongDevelopment Zone Association are discussed. Based on the theories of balancedscore card, performance evaluation system with three hierachies and fourperspectives including financial, customer, internal business process, and learning and growth, is constructed; the indicators in all levels are discussed andthe weight of the indexes are determined using the method of analytic hierarchyprocess. Furthermore, the constructed performance evaluation system of theJinzhong Development Association is applied; the performance appraisalorganization, evaluation process, and evaluation period are designed; and theimplementation safeguard measures have been put forward and theimplementation effects are summarized.With the architecture and principles set up by the balanced scorecard, theenterprise strategy is conversed into specific objectives and action plans withfour perspectives, vision and action plans are translated, strategy objectives andevaluating indicators are communicated and consistent, action plans arejustified, and feedback collecting and learning are strengthened. Therefore theperformance evaluation system based on the balanced score card becomes notonly a step of management system, but also a powerful enterprise strategymanagement tool.