Balanced Scorecard

Question 1

Kaplan & Norton (1996)
Balanced Scorecard
4 Aspects

Answer 1

Translating the vision: Generic statements like “become best in class” translated to actionable things at local level

Communicating & linking: Strategy communicated throughout the firm, link it to deartmental goals

Business Planning: Allocate resources in the division according to the scorecard goals

Feedback & Learning: Monitor results and give feedback

Question 2

Kaplan & Norton (1996)
Balanced Scorecard Benefits

Answer 2

Broader than standard metrics, uses not financial KPIs (financial, customer, internal processes, learning & growth) giving HOLISTIC view on performance

Links strategy to organisational goals. Doesn’t neglect employee development, customer satisfaction & internal process improvements

Real time feedback on performance. Helps evaluate and make quick adjustments

Question 3

Barriers to Balanced Scorecard (BSC) success:

4

Answer 3

Lack of clear strategy alignment, only effective when that strategy is shared at all organisation levels

Lack of leadership commitment: requires strong executive support

Effective cascading: has to be properly aligned with day-to-day operations with actionable objectives.

Overemphasis on financial metrics, whereas BSC meant to balance this with long-term KPI’s like customer satisfaction etc.