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Management article
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Reference no. BSJ02-06
Published by: Allied Business Academies
Published in: "Business Studies Journal", 2010
Length: 19 pages

Abstract

Toyota's woes have been attributed by Mr Akio Toyoda (Chairman, Toyota Motors) to the excessive focus on profitability and market share-a departure from their main focus on customers and continuous improvement. Similarly, many businesses ranked highly in one performance category have failed in others. The balanced scorecard approach, as popularized by Kaplan and Norton, includes three non-financial measures-customer, internal processes, and innovation & learning-in addition to the financial category. Yet, there are many lists and rankings which exclusively look at business performances from a narrow focus. Four such popular rankings are reviewed. They are: 1) Best global brands; 2) Best places to work; 3) Highest stockholder return; and 4) AMR Research's Supply Chain Top 25. This paper compares the methodology used to develop these four lists. Further, it is suggested this multi-dimensional approach may be a more comprehensive method to evaluate organisations. An analysis and discussion is presented on why many businesses appear on multiple top 25 lists whereas some made it to just one-which supports our premise that a comprehensive approach for ranking is critical. Finally, a list of variables is proposed to develop a more inclusive index for rankings.

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Abstract

Toyota's woes have been attributed by Mr Akio Toyoda (Chairman, Toyota Motors) to the excessive focus on profitability and market share-a departure from their main focus on customers and continuous improvement. Similarly, many businesses ranked highly in one performance category have failed in others. The balanced scorecard approach, as popularized by Kaplan and Norton, includes three non-financial measures-customer, internal processes, and innovation & learning-in addition to the financial category. Yet, there are many lists and rankings which exclusively look at business performances from a narrow focus. Four such popular rankings are reviewed. They are: 1) Best global brands; 2) Best places to work; 3) Highest stockholder return; and 4) AMR Research's Supply Chain Top 25. This paper compares the methodology used to develop these four lists. Further, it is suggested this multi-dimensional approach may be a more comprehensive method to evaluate organisations. An analysis and discussion is presented on why many businesses appear on multiple top 25 lists whereas some made it to just one-which supports our premise that a comprehensive approach for ranking is critical. Finally, a list of variables is proposed to develop a more inclusive index for rankings.

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