1. Using the balanced Score
Card as a strategic
management system
By Robert Kaplan & David Norton
Presented by: Felix Sie
2. Agenda
• Background of BSC
• Objectives
• BSC - What is it?
• How does it work?
• Benefits of BSC
• Criticisms of BSC
• Key Learning and Conclusion
3. Background
• Developed by Dr. Robert Kaplan and Dr. David Norton between 1990 - 1993
• Used for Strategic Management & Organizational performance measurement
• A study in 1997 by Kurtzman found 64 percent of respondents used some form of
BSC with various types of perspectives
4. Objectives
Balance Scorecard is a framework for coordinating and fine-tuning a
company’s operations and processes so that they are aligned with strategy
5. BSC- What is it?
http://www.valuebasedmanagement.net/methods_balancedscor
ecard.html
6. How does it work?
http://www.int-med.uiowa.edu/research/tlirp/ISATNA/report01.html
7. BSC - In practice!
Translating the vision:
• What are we trying to achieve through the vision?
Communicating and linking
• Does each business unit understand its role and how does their individual
goals tie into the organization’s score card?
Business planning
• Is organization’s budget and other processes aligned with the strategic plan? –
bring strategy and budget together to achieve the goals
Feedback and learning
• Did we achieve our goals? If not then why?
8. Benefits of using BSC
It helps to balance operations between financial and non-financial aspects
Build the company’s competencies in a systematic way
Communicate the organization’s strategy to stakeholders and customers
Track only what matters
Link performance to compensation
9. Criticisms of the BSC
• It requires lots of time and planning sessions to layout what matters for
your organization
• Can be challenging for smaller companies to use – if they are still
struggling to find what matters
• It can be challenging to bring everyone on board to use the scorecard
10. Key Learning & Conclusion
• The tool provides a holistic approach for obtaining a balance in an organization
• For start-ups and emerging companies the BSC might not be applicable until
companies learn about what matters
• By its nature, it helps an organization to align its processes and focus on achieving
long-term goals