2. WHAT IS A BALANCED SCORECARD?
The Balanced Scorecard is a strategic planning and management
system used to align business activities to the vision and strategy of
the organization by monitoring performance against strategic goals.
3. BALANCED SCORECARD CONCEPT
Was first published in 1992 by Kaplan and Norton, a book followed in 1996.
Traditional performance measurement that only focus on external
accounting data are obsolete.
The approach is to provide 'balance' to the financial perspective.
4. WHY USE A BALANCED SCORECARD?
Improve organizational performance by measuring of management
functions.
Increase focus on strategy and results.
Align organization strategy with workers on a day-to-day basis.
Focus on the drivers key to future performance.
Improve communication of the organization’sVision and Strategy.
Prioritize Projects / Initiatives.
5. STRATEGIC MANAGEMENT
Strategic management is the continuous planning, monitoring, analysis
and assessment of all that is necessary for an organization to meet its
goals and objectives.
6. STRATEGY EVALUATION
Finding out what is going on is what evaluation is all about. Strategy
evaluation means collecting information about how well the strategic
plan is progressing.
Strategic Evaluation is defined as the process of determining the
effectiveness of a given strategy in achieving the organizational
objectives and taking corrective action wherever required.
7. IMPORTANCE OF STRATEGY EVALUATION
Strategy Evaluation helps to keep a check on the validity of a strategic choice.
Strategy Evaluation can help to assess whether decisions match the intended
strategy requirements.
Strategy Evaluation, through its process of control, feedback, rewards and
review, helps in a successful culmination of the Strategic Management process.
In the absence of such evaluation process, managers would not know explicitly
how to exercise such discretion.
The process of Strategic Evaluation provides a considerable amount of
information and experience to strategists that can be useful in new strategic
planning.
8. BALANCED SCORECARD FOR STRATEGY
EVALUATION
It is a process that allows firms to evaluate strategies from four
key perspectives: financial performance, customer knowledge,
internal business processes and learning and growth.
It answers the following questions:
How well is the firm continually improving & creating values such as
innovation, product quality?
How well is the firm sustaining & even improving upon its core
competencies & competitive advantage?
How satisfied are the firm’s customers?
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14. BALANCED SCORECARD BENEFITS
Helps align key performance measures with strategy at all levels of an organization
The methodology facilitates communication and understanding of business goals and
strategies at all levels of an organization
Strategic initiatives that follow "best practices" methodologies that cascade through
the entire organization
Transforms an organization’s mission statement and strategic plan from a passive
document into the "marching orders" for the organization on a daily basis.
It enables executives to truly execute their strategies by identifying what should be
done and measured.
