Introduction to Balanced Scorecard (PowerPoint PPT)

This presentation is an introduction of the balanced scorecard concepts and its application in corporate performance measurement. It has been used by a major consulting firm in conducting education sessions for its clients in a balanced scorecard project.

The contents include: BSC concept, BSC process, what makes a good objective and measure, example objectives and measures, example BSCs (Telco, Chemco, Manufco, OilCo, AluminumCo), lessons learned.

The BSC's focus is on factors which create long-term economic value in an organisation, for example:
+ Customer focus.
+ Organisational learning.
+ Business processes.

Traditional accounting measures are by definition backward looking:
+ Financial measures only reflect the results of actions already taken.
+ Do not provide an indication of future financial performance.
+ Do not indicate desired performance.
+ Do not provide a basis for planning and target setting.

The Balanced Scorecard (BSC) translates an organization's vision and strategy into a comprehensive set of performance measures across four dimensions: Financial/Shareholder, Customers and Partners, Internal Processes, and Learning and Innovation. This multi-faceted approach ensures that all aspects of the business are aligned with the strategic objectives. It’s not just about financial metrics; it’s about creating a balanced view that includes customer satisfaction, internal processes, and the capacity for learning and growth.

Alignment is key. The BSC framework cascades from high-level corporate goals down to individual scorecards, ensuring that every department and employee is focused on the strategic objectives. This cascading process helps in maintaining consistency and coherence across the organization. It also facilitates communication and understanding of the strategy at all levels, making it easier to manage and measure performance.

The document also emphasizes the importance of clear definitions for objectives, measures, and targets. Objectives define what needs to be achieved, measures indicate how success will be quantified, and targets specify the desired level of performance. By adhering to these definitions, organizations can ensure that their BSC is not only comprehensive, but also actionable. This clarity helps in setting realistic and achievable goals, ultimately driving the organization towards its strategic vision.