What is a Balanced Scorecard?

The origins of the Balanced Scorecard can be traced back to 1992 when
Robert S. Kaplan and David Norton introduced a method for measuring a company's performance.

The Balanced Scorecard is a management system that allows managers to focus on important success factors of their particular business. It combines financial, customer, internal process and learning and growth perspectives.

To create a Balanced Scorecard follow these three steps;

1. Translate your vision into operational goals
2. Communicate your vision and link it to performance
3. Review, feedback and adjust the strategy

A typical Balanced Scorecard will measure:

Financial Performance
Example: Number of debtors, cash flow or return on investment

Customer Perspective
Example: Time taken to process a phone call, results of customer surveys, number of complaints

Business process perspective
Example: Key business processes

Learning & Growth perspective
Example: Hours spent on staff training etc