This PPT slide, part of the 54-slide Balanced Scorecard - Comprehensive Guide PowerPoint presentation, outlines 3 fundamental principles that connect the Balanced Scorecard to business objectives, ensuring it meets management's informational requirements.
The first principle is the "Balanced" Approach. This emphasizes the need for a comprehensive view that incorporates not just financial metrics, but also customer satisfaction, internal processes, and learning and growth indicators. It highlights the importance of linking both "Outcomes" and "Drivers," suggesting a dual focus on what results are achieved and the factors that influence those results. This principle encourages organizations to adopt a holistic perspective in performance measurement.
The second principle focuses on the Key Number of Measures. It warns against the pitfalls of having too many metrics, which can dilute the effectiveness of the Scorecard. The recommended range for the number of measures is between 15 to 25, striking a balance that allows for clarity and strategic decision-making. The slide suggests that while fewer measures are preferable, the level of detail can be enhanced by creating Scorecards at various hierarchical levels within the organization. This layered approach can provide both high-level insights and granular data.
The third principle is the Cause-and-Effect Relationship. It stresses that all measures within the Scorecard should be logically connected to financial objectives. This principle underlines the necessity of establishing clear causal links between different metrics, ensuring that they collectively contribute to the overarching business goals. The logical hierarchy among Scorecards further supports this alignment, facilitating a structured approach to performance management.
Overall, the slide serves as a guide for organizations looking to implement or refine their Balanced Scorecard, emphasizing clarity, focus, and strategic alignment.
This slide is part of the Balanced Scorecard - Comprehensive Guide PowerPoint presentation.
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Balanced Scorecard Performance Management Performance Measurement Customer Satisfaction
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