Written by

Bernard Marr

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 20 books, writes a regular column for Forbes and advises and coaches many of the world’s best-known organisations. He has over 2 million social media followers, 1 million newsletter subscribers and was ranked by LinkedIn as one of the top 5 business influencers in the world and the No 1 influencer in the UK.

Bernard’s latest book is ‘Business Trends in Practice: The 25+ Trends That Are Redefining Organisations’

View Latest Book

Balanced Scorecard: Management Not Measurement

2 July 2021

Balanced Scorecard: Management not Measurement

The Balanced Scorecard is a strategic performance management tool designed for managing strategic performance and not only as a measurement and reporting tool. Kaplan and Norton suggest that the process of strategic performance management consists of four critical processes:

  • Clarifying and translating the vision and strategy
  • Communicating and linking the strategic objectives and measures.
  • Planning and setting targets, and aligning strategic initiatives
  • Enhancing strategic feedback and learning

Clarifying and Translating the Vision and Strategy

The process of identifying the strategic objectives and visualising them in a Strategy Map is the starting point for any Balanced Scorecard implementation. Consensus needs to be achieved among senior leaders in an organisation about the key objectives and they way they interrelate. There are often iterations between identifying objectives and mapping them into causal maps as a Strategy Map ensures that all objectives and measures are linked to overall deliverables and isolated objectives or ‘pet projects’ are avoided. 

Communicating and Linking the Strategic Objectives and Measures

Communicating the overall vision in form of Strategy Maps with associated KPIs throughout the entire organisation means that objectives are much better understood and local objective and targets can be placed into the overall strategic context. A two-way communication system should be put in place to encourage dialogue between the business units and executive management in order to engage people in the strategy process and to allow feedback.

Planning and Target Setting, and Aligning Strategic Initiatives 

Targets should be established for each of the objectives and measured by the KPIs. The target setting process is best done in the context of the strategic initiatives and projects that are linked to each of the strategic objectives. Targets should take into account causal-and-effect lag times and should be stretching but achievable.

Enhancing Strategic Feedback and Learning

In the final stage of the management process, the Balanced Scorecard is integrated into a strategic learning process. Together with Kaplan and Norton I agree that this process is the most important aspect of the entire scorecard management process. It is important to put processes in place which enable managers to learn from their performance information and improve their future decision making. In addition, Strategy Maps and KPIs should be used to challenge and test the business model in order to refine and improve it over time to continuously improve performance.

Data Strategy Book | Bernard Marr

Related Articles

How To Set SMART Goals To Help You Succeed | Bernard Marr

How To Set SMART Goals To Help You Succeed?

When I work with companies, one of the things I do is help them establish goals that will give them the best possible chance of success [...]

What Skills Are The Most Needed Right Now | Bernard Marr

What Skills Are The Most Needed Right Now?

The annual Coursera Global Skills Report helps leaders and [...]

OKR vs MBO: What is the Difference?

MBO (which stands for “management by objectives”) has been a […]

Balanced Scorecard Part 1: A Brief History

A short look at the development of the balanced scorecard […]

Performance management- the measurement trap (part 3)

Performance Management and the limitations of measurement Performance management relies […]

The 10+ Most Important Job Skills Every Company Will Be Looking For In 2020

As the world evolves to embrace the 4th industrial revolution, […]

Stay up-to-date

  • Get updates straight to your inbox
  • Join my 1 million newsletter subscribers
  • Never miss any new content

Social Media

0
Followers
0
Likes
0
Followers
0
Subscribers
0
Followers
0
Subscribers
0
Followers
0
Readers

Podcasts

View Podcasts