2. The Balanced Scorecard is a measure of the key
elements of a company’s strategy, ranging from
continuous improvement and partnerships, to
team work and global scale.
Organisations design their unique balanced
scorecard based upon their unique constraints. A
company’s performance depends on how it
measures its performance.
3. Managers cannot afford to rely on either financial
or operational measures exclusively.
No single measure provides a clear performance
target focusing on the critical areas of a business.
Thus there is a need for balanced representation
of both financial and operational measures.
4. Kaplan and Norton have devised a balanced
scorecard- a set of measures that give top
managers a quick but comprehensive view of the
business.The balanced scorecard consists of –
a)financial measures that measure the actions
already taken.
b)The scorecard also contains operational
measures such as customer satisfaction, internal
processes and the organisation’s innovation and
improvement activities.
5. The balanced scorecard can be compared with
dials and indicators in an airline cockpit.
Pilots need detailed information of many aspects
of flight for navigating and flying an airplane.
6. These information is necessary to get an idea of
the current and predicted environment..
Relying on an single measure can be fatal.
Just like a pilot, a manager should be able to view
performance in several areas at the same time.
7. Using a balanced scorecard, managers can look at the business in
terms of four dimensions. The balanced scorecard answers four
basic questions1. HOW DO CUSTOMERS SEE US?
2.WHAT MUST WE EXCEL AT?
3.CAN WE IMPROVE AND CREATE VALUE?
4.HOW DO WE LOOK TO SHAREHOLDERS?
9. WHAT MUST WE EXCEL AT?
GOALS
Technology capability
MEASURES
Manufacturing geometry vs.
competition
Manufacturing excellence Cycle time/ unit cost/yield
Design productivity
Efficiencies
New product introduction
Actual introduction schedule
vs. plan
10. CAN WE IMPROVE AND
CREATE VALUE
GOALS
Technology
leadership
MEASURES
Time to develop next generation
Manufacturing
learning
Process time to maturity
Product focus
Percent of products that equals 80%
sales
Time to market
New product introduction vs.
competition
11. HOW DO WE LOOK TO
SHAREHOLDERS?
GOALS
MEASURES
Survive
Cash flow
Succeed
Quarterly sales
growth and operating
income by division
Prosper
Increased market
share and ROI
12. Many firms use balanced scorecard as a strategy tool
It brings many elements of a company’s strategy in a
single report.
The balanced scorecard is appropriate for
organisations of today to be on track and move
confidently into the future. The scorecard keeps
strategy and vision at the center
