Balanced Scorecard

The Balanced Scorecard is a strategic planning and management framework that is used to “to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organization performance against strategic goals”.(source: Balanced Scorecard Institute)

Type

Framework

Owner

The owner of the Balanced Scorecard is the Balanced Scorecard Institute.

“The Balanced Scorecard Institute provides training, certification and consulting services to commercial, government, and non-profit organizations worldwide. The Institute applies best practices gained from hundreds of consulting assignments and 5,000 trainees in balanced scorecard, strategic performance management and measurement, strategic planning, and change management to help executives, managers and analysts transform their organizations into “performance excellence” organizations.”

Source: balancedscorecard.org

Brief history and description

The Balanced Scorecard was originated by Drs. Robert Kaplan (Harvard Business School) and David Norton as a performance measurement framework that added strategic non-financial performance measures to traditional financial metrics to give managers and executives a more ‘balanced’ view of organizational performance. The Balanced Scorecard has evolved from its early use as a simple performance measurement ‘dashboard’ to a full strategic planning and management system. It transforms an organization’s strategic plan from a passive document into the ‘marching orders’ for the organization on a daily basis.

The Balanced Scorecard is a management system (not only a measurement system) that enables organizations to clarify their vision and strategy and translate them into action. It provides feedback around both the internal business processes and external outcomes in order to continuously improve strategic performance and results.

The Balanced Scorecard has four perspectives (see Figure):

  • The Learning and Growth Perspective: employee training and corporate cultural attitudes related to both individual and corporate self-improvement.
  • The Business Process Perspective: internal business processes.
  • The Customer Perspective: customer focus and customer satisfaction.
  • The Financial Perspective: financial and financial-related data, such as risk assessment and cost-benefit data.

Balanced Scorecard; (Adapted from Robert S. Kaplan and David P. Norton, “Using the Balanced Scorecard as a Strategic Management System,” Harvard Business Review (January-February 1996): 76.; source: www.balancedscorecard.org)

Target Audience

Senior management; strategic planners; business managers

User communities and groups

The Balanced Scorecard Institute acts as the main hub for the Balanced Scorecard user community.

Official publisher

Articles & White Papers Related to the Balanced Scorecard & Performance Management can be obtained from the Balanced Scorecard Institute site.

Accreditations and qualifications

The Balanced Scorecard Institute runs a Balanced Scorecard ProfessionalTM Certification program. Information can be found on their site. two levels of certification: Balanced Scorecard Master ProfessionalTM (BSMP), and Balanced Scorecard ProfessionalTM (BSP), are offered in association with the George Washington University College of Professional Studies.

Tooling

The Balanced Scorecard Institute offers Balanced Scorecard Software (for example for business Intelligence, dashboards and performance management systems). More information can be found on their site.

Links

Official Sites Balanced Scorecard.org home page
User groups and communities See home main menu
Publications See home main menu
Accreditations and Qualifications See home main menu
Tooling See home main menu
Other useful links n/a
FREE IBPI documents Whitepapers
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