Performance management: The balanced scorecard

Question 1

What are the 4 areas of the balanced scorecard ?

Answer 1

Financial - shareholder value?
Customer - customer value?
Internal business - processes excel at to achieve objectives?
Innovation and business - continually adding value?

Question 2

Quickly, tell me what is the flow of the balanced scorecard approach ?

Answer 2

4 areas of BSC >
Identify CSFs within each of the 4 areas >
Develop KPIs (measure progress) >
Targets set >
Performance monitored.

Question 3

What are the benefits of The BSC ?

WIDE - BSC widens the view of performance.

Answer 3

Wider perspective (Int & Ext)
Includes non-financial factors.
Drives long-term success.
Enables strategic focus beyond financials.

Question 4

What are the problems of The BSC ?

SOIC - ‘So Ick!’, icky challengers that the BSC can present when trying to implement.

Answer 4

Selection of measures.
Obtaining information.
Information overload.
Conflict between measures.