There are numerous performance management tools available that can talk about the present or past performance. Also, they work in silos. Some focuses more on financial metrics while some on customer services. All of them lack the holistic view. This is when in 1992, Robert Kaplan and David Norton published article in Harvard business Review that introduces the balanced scorecard and it become best seller quickly. The Unique proposition of this tool is that it not only talks about present performance but also captures the data points that indicate how well the firm is positioned in order to deliver value in future. Also, rather than talking in silos, this framework of performance assessment was holistic and has 4 major areas which are as follows:
Each of the above perspective will be discussed in detail in further course of this paper.
Balanced scorecard helps in channelizing the efforts of the whole organization towards achieving few key metrics which are actually responsible for creating more value to your customers and that is how it helps in building the more balanced business ensuring that good performance in 1 department is not just getting offset by low performance in another department. Instead, it focuses on both leading and lagging indicators so that the organizations is more balanced and grow in all the 4 perspectives (Keyes, 2016).
Balanced scorecard companies are those that have implemented or are in process of implementing this scorecard. There are companies like Cigna Insurance, Exxon Mobil, Emerson Electric that have implemented this scorecard. In order to implement it, organization first defines its business strategy. Business strategy consists of defining a vision statement and where the organization sees itself in next 5 or 10 years and mission statement that talks about how the organization will achieve its vision. Once the strategy is defined, organization defines key business objective that help the organization to achieve the business strategy. Next step is identifying measures and metrics to track the progress (Kaplan, & Anderson, 2013). Balanced scorecard has defined the 4 criteria and key metrics from each of the area should be selected to track the progress. Last step is implement which consists of getting data points and calculate metrics value and focus on continuous improvement so as to improve the value of the metrics.
Also, all these steps are interdependent. For instance, Business strategy is used to define the objectives and at the same time performances are measured against objectives which confirm to the strategy (Letza & Coe, 2014). This model will be refined and more details will be added as the organization progresses. The model of balance scorecard yields maximum benefits only when it has the support of various internal and external stakeholders in the organization. It is important that the leaders and managers should have the support of both internal and external stakeholders.
Balance scorecard is one of the most widely tool used by current days organizations. In fact, the use of balanced scorecard has increased in last decades and it is expected that its use would further increase in the future. Balanced scorecard is quite relevant for business because it is not something that works in isolation. But it can be aligned to the management strategy and thus become a framework to evaluate the effectiveness of the strategy and how the organization is positioned to perform in the future. The main advantage of this scorecard is that it helps the business to convert the business strategy into business objectives and which can then be split into key metrics for all the 4 areas defined by the balanced scorecard. Once the key metrics are identified, their performance can be benchmarked against best in class companies and company can understand where it stands in terms of competition and what steps should it take to become more competitive. It also becomes aware of its strong points and weak points. This model equally focuses on strong and weak points and suggests that strong points should not be offset for weaker points. It is because this model is holistic in nature and advocates that organization should focus on key metrics from all the 4 areas as they are the true reflection of the effectiveness of the strategy (Niven, 2014).
Also, this model is quite flexible from management point of view and allows changes with changes in strategy. Business strategy is very hollow terms unless it is accompanied by the parameters whose value can be measured. Parameters like market share, core competency focus on 1 aspect but not balanced. For instance it is possible that 1 organization have maximum market share but if it is not balanced on Innovation and learning area as mentioned in balanced scorecard, it will fail in future. Yahoo, Kodak, Xerox are examples of such companies which become laggards from leaders because they fail to reinvent themselves with changing market conditions. Core competency is also about the internal processes that company do very well and that differentiates itself from its competitors however alone core competency does not tell anything if your customer is willing to pay for your core competency. Hence, balanced scorecard is needed that can talk about the parameters from holistic point of view (Perkins, Grey, & Remmers, 2014).
Reference
Coe, N., & Letza, S. (2014). Two decades of the balanced scorecard: A review of developments. The Poznan University of Economics Review, 14(1), 63.
Gibbons, R., & Kaplan, R. S. (2015). Formal Measures in Informal Management: Can a Balanced Scorecard Change a Culture?.
Hoque, Z. (2014). 20 years of studies on the balanced scorecard: trends, accomplishments, gaps and opportunities for future research. The British accounting review, 46(1), 33-59.
Kaplan, R., & Anderson, S. R. (2013). Time-driven activity-based costing: a simpler and more powerful path to higher profits. Harvard business press.
Keyes, J. (2016). Implementing the IT balanced scorecard: Aligning IT with corporate strategy. CRC Press.
Niven, P. R. (2014). Balanced Scorecard Evolution: A Dynamic Approach to Strategy Execution. John Wiley & Sons.
Perkins, M., Grey, A., & Remmers, H. (2014). What do we really mean by “Balanced Scorecard”?. International Journal of Productivity and Performance Management, 63(2), 148-169.
We provide professional writing services to help you score straight A’s by submitting custom written assignments that mirror your guidelines.
Get result-oriented writing and never worry about grades anymore. We follow the highest quality standards to make sure that you get perfect assignments.
Our writers have experience in dealing with papers of every educational level. You can surely rely on the expertise of our qualified professionals.
Your deadline is our threshold for success and we take it very seriously. We make sure you receive your papers before your predefined time.
Someone from our customer support team is always here to respond to your questions. So, hit us up if you have got any ambiguity or concern.
Sit back and relax while we help you out with writing your papers. We have an ultimate policy for keeping your personal and order-related details a secret.
We assure you that your document will be thoroughly checked for plagiarism and grammatical errors as we use highly authentic and licit sources.
Still reluctant about placing an order? Our 100% Moneyback Guarantee backs you up on rare occasions where you aren’t satisfied with the writing.
You don’t have to wait for an update for hours; you can track the progress of your order any time you want. We share the status after each step.
Although you can leverage our expertise for any writing task, we have a knack for creating flawless papers for the following document types.
Although you can leverage our expertise for any writing task, we have a knack for creating flawless papers for the following document types.
From brainstorming your paper's outline to perfecting its grammar, we perform every step carefully to make your paper worthy of A grade.
Hire your preferred writer anytime. Simply specify if you want your preferred expert to write your paper and we’ll make that happen.
Get an elaborate and authentic grammar check report with your work to have the grammar goodness sealed in your document.
You can purchase this feature if you want our writers to sum up your paper in the form of a concise and well-articulated summary.
You don’t have to worry about plagiarism anymore. Get a plagiarism report to certify the uniqueness of your work.
Join us for the best experience while seeking writing assistance in your college life. A good grade is all you need to boost up your academic excellence and we are all about it.
We create perfect papers according to the guidelines.
We seamlessly edit out errors from your papers.
We thoroughly read your final draft to identify errors.
Work with ultimate peace of mind because we ensure that your academic work is our responsibility and your grades are a top concern for us!
Dedication. Quality. Commitment. Punctuality
Here is what we have achieved so far. These numbers are evidence that we go the extra mile to make your college journey successful.
We have the most intuitive and minimalistic process so that you can easily place an order. Just follow a few steps to unlock success.
We understand your guidelines first before delivering any writing service. You can discuss your writing needs and we will have them evaluated by our dedicated team.
We write your papers in a standardized way. We complete your work in such a way that it turns out to be a perfect description of your guidelines.
We promise you excellent grades and academic excellence that you always longed for. Our writers stay in touch with you via email.