7.3d - Kaplan and Norton Flashcards
1
Q
Kaplan and Norton Balanced Scorecard definition
A
A model for assessing non-financial measures of performance
2
Q
What are the aims of the K&N Balanced Scorecard?
A
- Align business activities to vision of the business
- Improve internal and external communicates
- Monitor business performance against strategic goals
3
Q
What are the perspectives of the Balanced Scorecard?
A
- Financial
- Internal processes
- Organisational capacity
- Customer
4
Q
What does ‘internal processes’ focus on?
A
Business efficiency
5
Q
What does ‘organisational capacity’ focus on?
A
Knowledge and innovation
6
Q
What do managers need to consider for each perspective of the Balanced Scorecard?
A
- Objectives
- Measures
- Targets
- Initiatives
7
Q
Key features of the Balanced Scorecard:
A
- Top-down approach
- Starts with mission and vision of the business
- Identifies key performance indicators
- Emphasises importance of non-financial measures
8
Q
Advantages of Balanced Scorecard:
A
- Broader view of business performance
- Links performance measurement to long-term
- Constant monitoring
- Involves everyone in the business
- Flexible
9
Q
Disadvantages of Balanced Scorecard:
A
- Danger of too many key performance indicators
- Getting balance between perspectives is difficult
- Senior management may still be too concerned with financial performance
- Needs to be updated regularly to be useful
