Balanced Scorecard

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Balanced Scorecard
Amber Moore
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What is Balanced Scorecard??

• The Balanced Scorecard is a management tool that
  provides stakeholders with a comprehensive
  measure of how the organization is progressing
  towards the achievement of its strategic goals.
• Enables organizations to clarify their vision and
  strategy and translate them into action.
• Helps managers focus on performance metrics while
  balancing financial objectives with customer,
  process and employee perspectives.

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Balanced Scorecard

• The Balanced Scorecard
• Balances financial and non-financial measures
• Balances short and long-term measures
• Balances performance drivers (leading indicators)
  with outcome measures (lagging indicators)
• Leads to strategic focus and organizational
  alignment.

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Principles of a Strategy Focused Organization
1. Translate the strategy to operational
terms. 2. Align the organization to the
strategy. 3. Make strategy everyones job. 4.
Make strategy a continual process. 5. Mobilize
change through executive leadership
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The Strategy Focused Organization
Mission What we do Vision What we aspire
to be Strategies How we accomplish our
goals Measures Indicators of our progress
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Balanced Scorecard

• The balanced scorecard suggests that we view the
  organization from four perspectives, and to
  develop metrics, collect data and analyze it
  relative to each of these perspectives
• -The Learning and Growth Perspective
• -The Business Process Perspective
• -The Customer Perspective
• -The Financial Perspective

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The Learning Growth Perspective
This perspective includes employee training and
corporate cultural attitudes related to both
individual and corporate self-improvement to
achieve our goals and accomplish core activities,
we must learn, communicate and work
together. -Tries to reverse brain-drain -Empha
size that 'learning' is more than 'training,
includes things like mentors and tutors within
the organization, communication and technological
tools. -Performance Indicators -Investment
Rate -Illness rate -Internal Promotions 
-Employee Turnover -Gender/Racial Ratios
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The Business Process Perspective

• This perspective refers to internal business
  processes to satisfy our customers, in which
  business processes must we excel?
• Two types of Business Processes can be
  identified
• 1. Mission-oriented processes
• 2. Support processes
• -Performance Indicators
• -Number of Activities
• -Opportunity Success Rate
• -Accident Ratios
• -Defect Rates

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The Customer Perspective

• This perspective emphasized the importance of
  customer focus and customer satisfaction to
  achieve our vision, what customer needs must we
  serve?
• Look at the Long term position, not just the
  short term.
• Performance Indicators
• -Delivery Performance to Customer - by Date
• -Delivery Performance to Customer - by Quantity
• -Customer satisfaction rate
• -Customer retention

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The Financial Perspective

• To satisfy our customers, what financial and
  regulatory objectives must we accomplish?
• -Timely and accurate funding data will always be
  a priority
• Also included in this category is additional
  financial-related data, such as risk assessment
  and cost-benefit data.
• Performance Indicators
• -Cash flow
• -ROI
• -Financial Result
• -Return on capital employed
• -Return on equity

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Why Use Balanced Scorecard?

• To achieve strategic objectives.
• To provide quality with fewer resources.
• To eliminate non-value added efforts.
• To align customer priorities and expectations
  with the customer.
• To track progress.
• To evaluate process changes.
• To continually improve.
• To increase accountability

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References Used
The Balanced Scorecard Institute
http//www.balancedscorecard.org/ Applying the
balanced scorecard for better performance of
intellectual capital. Sanjoy Bose, Keith Thomas.
Journal of Intellectual Capital Oct2007, Vol. 8
Issue 4, p653-665, 13p http//www.valuebasedmana
gement.net/methods_balancedscorecard.html