Balanced Scorecard

What are the 4 perspectives of a balanced scorecard?

1. Financial.
2. Customer.
3. Internal Process.
4. Learning and Growth.

Why is it called a balanced scorecard?

The balanced scorecard gives a ‘balanced’ perspective of all the categories on it. In simpler words, it shows a balanced view of your company, business unit, or project. Around 73% of the companies in the world reported it as extremely or very helpful.

What is a balanced scorecard in HRM?

Balanced scorecard was first developed by Dr. Robert Kaplan and Dr. David Norton. In HRM, balanced scorecard is a strategic approach to measure the effectiveness of an HR management. It evaluates the non-financial performance measurements alongside the traditional financial metrics.

How do you create a balanced scorecard?

To achieve your strategic goals, create the balanced scorecard by following the given steps:

1. Identify the organization’s strategic goals for each of the 4 business perspectives and have a vision in place.
2. Do strategy mapping to the objectives.
3. Outline the performance measures that is KPIs.
4. Link each perspective to the others.
5. Share and analyze.

What are the benefits of using balanced scorecards?

There are five key stages for redundancy:

• Helps in efficient strategy planning.
• Gives a clear insight into priorities and KPIs.
• Enhances performance management.
• Enables better alignment of business perspectives with respect to key objectives.

What is the difference between a balanced scorecard (BSC) and KPI?

The basic concept of both balanced scorecard and KPI is the same and it is to align workers' performance with the long-term strategic objectives of the company.

BSC is a strategic planning system that organizations use to improve strategic performance across different four different perspectives. Whereas, KPI help companies effectively manage and guide their progress with respect to performance goals.

How do you implement a balanced scorecard?

The best way to implement a BSC is by following a bottom-up approach. This implies that you integrate and align all the 4 perspectives in the form of a map against the objectives and work upwards to achieve the maximum possible financial gain.