The Balanced Scorecard (BSC) is a strategy performance management tool – a structured report that managers use to track the performance and activities of the people who work for the organization. The Balanced Scorecard also helps managers monitor and measure performance. The Balanced Scorecard can also be used by individuals to track personal performance.
Two functions of the BSC make it an important part of modern business management: the BSC makes it easier to select which data to observe and the BSC ensures that the choice of data can be monitored and controlled.
Design of a balanced scorecard identifies a small number of financial and non-financial measures and attaches targets to these measures. When these measures are reviewed, managers can determine if current performance “meets expectations.” The BSC lets managers know where performance deviates from expectations. Managers can then focus their attention on these areas and as a result, take steps to correct and improve performance.
Before you start to work on your main post, watch this 4-minute video (Links to an external site.) on how the Balanced Scorecard is used.
After reading about the Balanced Scorecard in our text, discuss how you would develop a simple Balanced Scorecard for the same company you selected for your Unit 1 Charter, and Unit 2 process map. Your main post should include the following points:
- In one paragraph, explain which critical elements you selected to include in your Balanced Scorecard.
- Explain your Balanced Scorecard vision and communications.
- Describe how your Balanced Scorecard will impact business planning.