BABOK® v3 Demystified
Chapter: Chennai IIBA® Chapter
Date & Time: 26-May-16 | 6:30 to 7:30 PM IST
Topic: Balanced Scorecard
Presenter: Venkadesh Narayanan
BSME, MBA, CBAP®, PMI-PBA®, CPRE-FL, CBPP®, CSCP
Thought Provoking Words
“I often say that when you can measure what you are speaking about, and
express it in numbers, you know something about it; but when you cannot
measure it, when you cannot express it in numbers, your knowledge is of a
meager and unsatisfactory kind. If you can not measure it, you can not
- Lord Kelvin, British Scientist
• Strategic Planning and Management Tool
• Measure Organizational Performance
• Beyond the traditional financial measures
• Provides a balanced view of an enterprise by implementing the
strategic plan as an active framework of objectives and
• How will the decisions you make today affect your business
• That’s the most important question to a manager can ask. But to
answer it, they aften rely on financial metrics which can
overemphasize the short-term. To win the long-term you need to
take a more balanced view.
• That’s why Harvard Business School Professor Robert S.kaplan
and consultant David P.Norton developed the Balanced
• In the industrial age, most of the assets of a firm were in property,
plant, and equipment and the financial accounting system
performed an adequate job of valuing those assets.
• In the informational age, much of the value of the firm is
embedded in innovative processes, customer relationship, and
human resources. The financial accounting system is not so
good at valuing such assets.
Vision and Strategy vs BSC
Purpose of BSC
Four Perspectives of BSC
• The Scorecard uses four perspectives to measure your
• Financial Perspective
• Are you doing well by your stakeholders?
• Customer Perspective
• Do they like your products and services?
• Internal Perspective
• Can you efficiently deliver what your customers want?
• Learning and Growth Perspective
• Can you continue to improve and create value?
• It’s financial goals were to
• For assessment, it used
• Cash flow
• Quarterly sales growth
• Market share
• Its customer goals were to develop innovative, tailored products,
to get them to market faster and to become a supplier of choice.
• To measure success, managers used percentage of sales from
new products, on-time delivery rates and popularity with key
• Looking internally, the company prioritized goals like excellent
manufacturing, producing new designs, and introducing new
products and again developed operational measures for each
Learning and Growth Perspective
• Last, for its learning and growth goals, it decided to focus on
developing new products, rather than improving existing ones.
• The company found that learning and innovation lead to better
competencies and processes, which in turn boosted customer
satisfaction and ultimately generated better stakeholder returns.
• Facilitates holistic and balanced planning and thinking
• Short-, medium-, and long-term goals can be harmonized into
programs with incremental success measures
• Strategic, tactical, and operational teams are more easily aligned
in their work
• Encourages forward thinking and competitiveness
• A lack of a clear strategy makes aligning the dimensions difficult
• Can be seen as the single tool for strategic planning rather than
just one tool to be used in a suite of strategic planning tools
• Can be misinterpreted as a replacement for strategic planning,
execution, and measurement
Fhyzics, a leader in Business Analysis Services and Training, is an
Endorsed Education Provider [EEPTM] of International Institute of
Business Analysis [IIBA®], Canada.
For more details about our course, please speak to Bharathi at
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Mr. Venkadesh Narayanan, BSME, MBA, CBAP®, PMI-PBA®, CPRE-FL, CBPP® , CSCP
Former Indian Civil Servant [IRAS 2001 Batch]