The Balanced Scorecard

An Introduction to The Balanced Scorecard

The Balanced Scorecard is an approach to strategic management intended to give an objective view of the performance of a business. It was developed in the early 1990's by Robert Kaplan and David Norton.

The Balanced Scorecard, known as the BSC, is a management system intended to help organizations clarify strategy and develop metrics to improve financial perspective.

BSC encourages us to view the business from four perspectives: The Learning and Growth Perspective; The Business Process Perspective; The Customer Perspective; The Financial Perspective. Within this, metrics are developed to reflect the business objectives.

Within each perspective, four aspects are assessed: objectives, measures, targets and initiatives. Outcome metrics are based upon: strategic feedback; diagnostic feedback with respect to the processes; chronological trends with respect to the metrics; feedback with respect to the measurement methods themselves; quantitative inputs to forecasting models (for decision support systems).



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