Balanced Scorecard: An Introduction
2 July 2021
Over recent years the Balanced Scorecard (BSC) has evolved into one of the most popular strategic management tools. The BSC was developed by Robert Kaplan and David Norton in the early 1990s and initially positioned as a strategic performance measurement innovation to counteract the prevalent financial bias in existing performance measurement systems.
The initial idea of the Balanced Scorecard
The initial idea of the Balanced Scorecard was that financial measures are lag indicators, which when used in isolation, could lead to short-term thinking. To promote the long-term value creation it was suggested that the financial perspective of performance should be complemented with measures in three supplementary perspectives, namely customer perspective, internal business perspective, and innovation and learning perspective.
Repositioning the Balanced Scorecard
In 1996, the Balanced Scorecard was repositioned as a strategic management system and it was suggested that firms move away from presenting Balanced Scorecards in a four-box model. Instead it was suggested that firms create a strategy map as the visual representation of a company’s critical objectives and the cause-and-effect relationships among them.
Balanced Scorecard Today
Today, strategy maps are seen as vital components of a Balanced Scorecard as they allow firms to understand how their intangibles are converted into tangible outcomes.
Related Articles
Generative AI: The Secret Weapon Of Successful CEOs
Remember how amazed we were when ChatGPT made its debut just a year ago? Well, as we’ve since learned, that was only the beginning.[...]
Virtual Reality, Real Business: The Impact Of The Metaverse On Companies
Metaverse has undoubtedly been one of the most talked-about concepts of the year. At the start of 2022, the focus was on Facebook’s surprise re-branding of itself to Meta Platforms.[...]
The Future Of Medicine: How AI is Shaping Patient Care And Drug Discovery
One of the most exciting aspects of AI is its implications for healthcare. Today, doctors and other medical professionals routinely augment their human skills and experience with the help of intelligent machines.[...]
Navigating The Future: 10 Global Trends That Will Define 2024
We’re approaching the mid-point of a decade in which we’ve already seen significant global transformation.[...]
Unlocking The Future Of Learning: How XR Tech Transforms Education
In the metaverse era, education as we know it will change. And I’m not just talking about formal education in schools, colleges, and universities – but also workplace learning and lifelong learning.[...]
2024 IoT And Smart Device Trends: What You Need to Know For The Future
By the end of 2024, there are projected to be more than 207 billion devices connected to the worldwide network of tools, toys, devices and appliances that make up the Internet of Things (IoT).[...]
Sign up to Stay in Touch!
Bernard Marr is a world-renowned futurist, influencer and thought leader in the fields of business and technology, with a passion for using technology for the good of humanity.
He is a best-selling author of over 20 books, writes a regular column for Forbes and advises and coaches many of the world’s best-known organisations.
He has a combined following of 4 million people across his social media channels and newsletters and was ranked by LinkedIn as one of the top 5 business influencers in the world.
Bernard’s latest book is ‘Generative AI in Practice’.
Social Media