Balanced ScoreCard :: Overview Click here to go to the homepage
What is it?
Created by Robert Kaplan and David Norton, the balanced scorecard (BSC) is based on the philosophy that "if you cannot measure it, you cannot manage it". BSC offers a way for an organization to gain a wider perspective on its strategic decisions by considering the impact on finances, customers, internal processes and employee learning. BSC is designed to measure degree of success in implementing business strategy. The analysis takes into account financial and nonfinancial measures, internal improvements, past outcomes and ongoing requirements as indications of future performance.
Why is it important?
BSC helps translate organizational strategy into action and align employees to common goals by articulating the a strategy for the vision by setting priorities and further aligning resources. BSC also helps eliminate conflict of goals caused by functional targets.
When to use it?
Helpful in translating high level organizational vision into specific short-term deliverables across different but connected critical success factors or key performance indicators relevant to the organization.  
How to use it?
Select relevant critial success factors in the BSC perspectives - define the crucial capabilities and purposes of the department and explore inter-relationships
1. finance
weigh the cost vs. benefits of an activity and the impact it will have on the rest of the company
2. customer
impact of project on the end customer and how any particual activity will influence users' opinions
3. organizational
determine whether any planned activity will fill the need of employees for continual development
4. operational
crucial capabilities and purposes of the activity
5. technology
evaluate technology required to carry out the activity efficiently

Identify performance indicators

  BSC facilitates bringing in different perspectives and focus attention on factors critical to the consumer while leveraging organizational capabilities. Thus it gives a fair comparison of various conflicting or differing approaches to achieving the same end result.
Set targets
  BSC helps determine appropriate department and process targets and helps by identifying/developing plans to eliminate the root causes of problems.
  Finally, deploy the plans to realize the goals.

What's on the web?
1. Balanced Scorecard Collaborative
(established by the creators of BSC + a monthly briefing)
Interview with the creators from
2. The Balanced ScoreCard Institute | Basic Concepts
3. Suggested Books
Performance Drivers: A practical guide to using the Balanced Scorecard by Olve, Nils-Goran; Roy, Jan; Wetter, Magnus | John Wiley & Sons, 1999
The Strategy Focused Organization (Building a Strategy Focused Organization::an article) by Kaplan, Robert S.; Norton, David P. | Harvard Business School Press, 2000
The HR Scorecard : Linking People, Strategy, and Performanceby Becker, Brian E.; Huselid, Mark A.; Ulrich, David | Harvard Business School Press, 2001
Food for Thought !
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