Sustainable Microfinance - Balanced Scorecard's added value for ...

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7. Conclusion, Recommendations and Limitations 7.1 Introduction First an answer to the research question is provided. Subsequently the theoretical contributions and practical implications are discussed. Followed by a research reflection where advantages and limitations are described. Finally suggestions for further research are presented. 7.2 Concluding Remarks The purpose of this study is making a contribution towards the existing literature and meanwhile enhancing the sustainability of the Dutch microfinance sector by adjusting (foreign) performance measurement systems to the specific needs of an important player in the field. The formulated research question is; ‘how can the Performance Measurement Systems (PMS) used (by Microfinance Institutions) in both developing and industrialized countries be used to provided the best added value for the microfinance sector in the Netherlands? 7.2.1 From the Literature Review Based on the literature, the following conclusions were drawn: • This study has the most added value when focussing on the pre-loan Business Development Services (BDS) in the Netherlands. This conclusion is threefold: o BDS are of major importance for the survival rate of starting entrepreneurs. Improving this survival rate will have a significant contribution towards the sustainability of the complete sector; o At the time of research no specific PMS has been found that is being used or provided by pre-loan BDS to start up micro and small entrepreneurs; o The relative late introduction of microfinance in the Netherlands enabled the single (major) microcredit supplier, Qredits, to learn from foreign experiences and develop a PMS that incorporates many of the advantages a Balanced Scorecard (BSC) related PMS could generate; Elmar Hoogendoorn 77 Sustainable Microfinance
• Since the development of microfinance in Europe, BDS have been regarded as an essential factor for the successful realization of a microloan. This stands in contrast to microfinance in developing countries, where credits are more often delivered without additional business support. • BDS are expensive and rely heavily on government subsidies, therefore government officials need to limit BDS to starting entrepreneurs with sufficient growth potential; • MFI cope with a double bottom line, therefore they are in pursuit of a PMS that allows them to measure both financial and non-financial results. A PMS that is invented to deal with financial and non-financial measures is the BSC. 7.2.2 From the Empirical Findings Based on the empirical findings, sixteen different categories emerged. After analyzing the empirical findings and comparing them with the theory, the following major conclusions can be drawn: • Starting point; potential entrepreneurs need to ask themselves three questions before starting up a business: o Why do I start this business? ! To discourage those that start for the wrong reasons o Where do I want to be in ‘three’ years? ! In order to develop appropriate and measurable targets o What contribution do I make towards the society? ! In order to ensure satisfying all related stakeholders and focussing the operational activities; • Social; taking a holistic view, each separate stakeholder is part of the society. When the business satisfies the society, by explicitly making an economic, social or ecological contribution, all the separate stakeholders are implicitly satisfied as well. This makes it easier to focus the operational activities; Elmar Hoogendoorn 78 Sustainable Microfinance
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! ! Sustainable Microfinance Balanc
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Keywords and Abstract Sustainable M
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Condensed Table of Contents ! ! Key
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3.3 Lessons from previously develop
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List of Figures ! Figure I-1: Thesi
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List of Abbreviations BDS Business
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1. Overview This chapter serves as
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In 2007, the Dutch Ministry of Econ
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collect information or seek specifi
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In some regions entrepreneurs are a
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• What different players in the D
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2. Theory and Literature Review - M
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investors expect to gain from the f
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2.4 Microfinance in (Western) Europ
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A MFI in the survival mode can bare
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The main factors that negatively af
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that are needed in order to transfo
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According to Lämmermann, et al. (2
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Page 47 and 48: emaining drivers of the model are;
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Page 107 and 108: 8. Table of contents Preface List o
Page 109 and 110: References Armendáriz, B. 2009, 'M
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Page 117 and 118: Organizational Development • What
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Appendix N - General BSC model ! Us
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Appendix O - Relation and Link ! Eq
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Appendix P - Most Important Financi
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Appendix R - Sustainability of Micr
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Appendix S - Qredits ! KH The main
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Bibliography Affleck, A. and Mellor
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Derban, W., Binner, J. and Mullineu
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the case of the tourism industry,
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Kunc, M. (2008), 'Using systems thi
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McKinsey & Company, p. 3., Availabl
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Shrader, C.B., Mulford, C.L. and Bl
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Woodworth, W. and Woller, G. (1999)
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