Balanced scorecard bsc emerged from such requirements, a performance instrument that can be integrated into the working of the business processes and used effectually for executing and monitoring of tasks by the workforce. Weaknesses, strengths, and its ability as performance management system versus other performance management systems milad abdelnabi salem 1 school of technology and logistic management, college of business, university utara malaysia sintok, 06010 kedah, malaysia. Matriks balanced scorecard tahap 5 perspektif peta strategi sasaran strategi indikator kinerja target 2008 action plan reali sasi bobot % score % finansial kat pad pad kat. The balanced scorecardmeasures that drive performance. Throughout the entire process of building and implementing a balanced scorecard. The second area of the balanced scorecard which is important to look at is the customer perspective. During the past 30 years, much attention has been focused on how companies can formulate new strategies for sustainable advantage.
Strategy maps and balanced scorecards constitute the measurement technology for managing in a knowledgebased economy. Quo vadis keynote speach 5th basel balanced scorecard forum, march 22, 2006 robert s. Balanced scorecard financial measurement of organizational. Like a laser beam, strategy now has a clear path to everyone in the organization. The strategyfocused organization page 3 construct balanced scorecards performance measures example of a balanced scorecard mobil north america marketing and refining. Performance management with a balanced scorecard physical performance metrics energy consumption water consumption building condition financial performance metrics. Limitations of balanced scorecard marko rillo tallinn. The bsc expands the traditional financial measures into three other dimensions to capture a balanced approach to measure performance in an organization. The balanced scorecard has emerged as a proven and effective tool in our quest to capture, describe, and translate intangible assets into real value for all of an organizations stakeholders and, in the process, to allow. The internal measures for the balanced scorecard innovation and learning perspective. Balanced scorecard is a management system that enables organizations to translate the vision and strategy into action. Performance evaluation using balanced scorecard bsc and. Page includes various formats of balanced scorecard examples for pdf, word and excel. Benefits of using balanced scorecard in strategic and operational.
Conceptual foundations of the balanced scorecard 3. The benefits of using balanced scorecard as a strategic management system are linked to the structure of a balanced scorecard process. The following paragraphs attempt to clarify some of these issues. As a result, oam is implementing a balanced scorecard bsc performance measurement and performance management program pmp as the methodology for assessing the agencys acquisition related business functions. Heads of contracting activities hcas and procurement directors pds are encouraged to use the bsc as an internal assessment tool and to promote. Though this scorecard is used to monitor all the activities, another main purpose that it fulfills is that it even keeps a check whether all the organizational.
The balanced scorecard bsc is a strategic planning tool developed by kaplan and norton 1996 as a response to the assumption that organizations only. The objective of balanced scorecard is to translate organisational vision and strategy into a specific objectives and measures in four main perspectives. Introduction to our balanced scorecard the balanced scorecard bsc is a strategic planning and management system that is used extensively in business and industry, government, and nonprofit organizations worldwide to align business activities to the vision and. Linking the balanced scorecard to strategy robert s. The balanced scorecard helps you cascade strategy and measure progress. By translating their strategy into the logical architecture of a strategy map and balanced scorecard, organizations create a common understandable point of reference for all their units and employees. Using the balanced scorecard to align your organization. Based on these dimensions, the next step is to think about the different types of kpis that need to be put in place. Konsep balanced scorecardbsc manajemen tradisionalmemandang keberhasilan organisasi hanya dari ukuran keuangan seperti likwiditas, rentabilitas, return of invesment roi atau profit. The balanced scorecard identifies the factors that create longterm economic value in an organization, for example. The pmp is intended to facilitate an epawide collaborative approach to ensure that business systems effectively support epas mission.
The four perspectives of the balanced scorecard 10. Balanced scorecard example the following is an example of how one might develop a balanced scorecard. A handbook of techniques and tools performance based management, us dept of energy. The paper uses the following structure for organizing the origin and subsequent development of the balanced scorecard. Over the years since its inception, the balanced scorecard has provided a practical model for nonprofit leaders, offering the tools needed to measure a nonprofits operational success. The balanced scorecard model is conceptualised on four business perspectives the balanced scorecard model allows managers to look at an organisation by focusing on four perspectives that are linked to the corporate vision and strategy for better performance. Using the balanced scorecard as a strategic management system. Scorecard dimensions idc believes that cdos will increasingly be assessed on the following five dimensions. Kaplan and norton describe the innovation of the balanced scorecard as follows. The effect of balanced scorecard on strategy participation.
Balanced scorecard examples download free documents for pdf. Feb 10, 20 background definition of balanced scorecard the balanced scorecard is a tool that translates an organizations mission and strategy into a comprehensive set of performance measures that provides the framework for a strategic measurement and management system. During a yearlong research project with 12 companies at the leading edge of. Pdf the use of the balanced scorecard in small companies. Interviews can be used to explore issues and options to a greater extent than written surveys. The balanced scorecard can be understood as a management sys. The balanced scorecard bsc is a performance measurement and strategic management system which appears suitable for use by all types and sizes of business.
Dahiru department of accountancy,university of maiduguri nigeria abstract. David norton and i introduced the balanced scorecard in a 1992 harvard business. Metricnets call center balanced scorecard the call center balanced scorecard step 1 six critical performance metrics have been selected for the scorecard step 2 each metric has been weighted according to its relative importance step 3 for each performance metric, the highest and lowest performance levels in the benchmark are recorded step 4. The balanced scorecard as a performance management. Using the balanced scorecard to measure government. Establishing measures for an acquisition system 12 2. Balanced scorecard stepbystep volta river authority. The balanced scorecard retains traditional financial measures. Balanced scorecard topic gateway series essentially, the bsc is a management system that enables an organisation to identify and clarify its vision and strategy, and translate them into action. Since time immemorial, management experts have performed various studies and researches i. The performance measurement measurement revolution.
Performance measurement using the balanced scorecard. Aims and indexes of balanced scorecard are determined by strategy and perspective of. My experiences as a balanced scorecard practitioner with a large canadian company taught me that tremendous results are possible with the tool, but to attain. The information included is fictional and is provided to simply demonstrate the process. Balanced scorecard basics communicat business systems.
It is noteworthy that chapter 4 deals with adopting a bsc to measure the performance of a portfolio of soe enterprises, rather than an individual soe. The balanced scorecard focuses on factors that create longterm value traditional financial reports look backward reflect only the past. Conceptual foundations of the balanced scorecard robert s. Success stories are beginning to accumulate and studies suggest the balanced scorecard is of great benefit to both these organization types. Managers want a balanced presentation of both financial and operational measures.
A good balanced scorecard connects a strategy map to measures, targets, and initiatives. Customer perspective, internal processes, learning and growth prepared by group 4. Norton s everal years ago, we introduced the concept of a balanced scorecard for motivating and measuring business unit performance. Bscmemandang ukuran keberhasilan bukan hanyadari perspektif keuangan. But financial measures tell the story of past events, an. Norton is founder and president of the balanced scorecard collaborative in lincoln, massachusetts. The balanced scorecard institute, a strategy management group company, helps organizations succeed through improved strategic focus and performance by providing training and consulting services related to best practices in balanced scorecard bsc, strategic performance management and measurement, and transformation and change management. The application of balanced scorecard provides equilibrium between multiple perspectives that will enable the organization to develop equally. Performance measurement and management program guide. The balanced scorecard is a technique to align critical success factors, performance indicators and targets with the organizations longterm business vision. Commentary transforming the balanced scorecard from performance measurement to strategic management. This perspective includes employee training and corporate cultural attitudes related to both individual and corporate selfimprovement. Andrew molloy amy miller mike elicker what is the balanced scorecard.
The balanced scorecard translates our vision and strategy into a coherent set of measures in four balanced perspectives. Developing and implementing a balanced scorecard rl information consulting llcrl information consulting llc page 3 people process technology organization integration centralization and processing, accessibility, and automation of. Kaplan baker foundation professor harvard business school. Indeed the phrase the balanced business scorecard appears to have entered the management vernacular. Aims and indexes of balanced scorecard are determined by strategy and perspective of organization. In short, by using a balanced scorecard, organizations increase the likelihood they will be able to execute the organizations strategy successfully. The call center balanced scorecard amazon web services. Processproduct perspective financial perspective critical success factors. Throughout the entire process of building and implementing a balanced scorecard, we all need to speak the same language. The real power of a properly developed balanced scorecard is that it links the performance measures to the organisations strategy. First, there is a lot of evidence supporting an argument that a balanced scorecard translates a strategy into operational terms kaplan. Commentary transforming the balanced scorecard from. The balanced scorecard has been translated and effectively implemented in both the nonprofit and public sectors.
Developing and using balanced scorecard performance systems howard rolm, perform, 2002 building and implementing a balanced scorecard howard rolm, us foundation for performance management how to measure performance. These aims and indexes look at performance of organization in four aspects. Shareholder and stakeholder approaches to strategic. A recent mori survey, for example, found that 72 per cent of business leaders agree that a successful business will better serve its. Background definition of balanced scorecard the balanced scorecard is a tool that translates an organizations mission and strategy into a comprehensive set of performance measures that provides the framework for a strategic measurement and management system. The balanced scorecard measures that drive performance. Kaplan is a professor at harvard university and david p. First, there is a lot of evidence supporting an argument that a balanced scorecard translates a strategy into operational terms kaplan and norton, 1996. The call center balanced scorecard step 1 six critical performance metrics have been selected for the scorecard step 2 each metric has been weighted according to its relative importance step 3 for each performance metric, the highest and lowest performance levels in the benchmark are recorded step 4.
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