The Balanced Scorecard: Benefits for Your Business

To increase business productivity, detect current management problems and attract new customers, most business owners and team leaders use various performance measurement tools. These tools help develop successful business strategies and increase the level of revenue. One of the most powerful and popular strategic management frameworks was introduced in 1996. The developers of this system Robert Kaplan and David Norton named their creation Balanced Scorecard. Many business gurus consider this system to be very helpful, because it helps evaluate personal and group performance of the personnel and company as a whole. This business management tool is connected to strategic planning and suggests methods for increasing business efficiency.To use this framework for the benefit of your own enterprise, you need to understand the basics of its functioning and implementation. First of all, you need to remember that Balanced Scorecard is a complex system that has several specific aspects you have to learn and understand. The implementation of BSC requires having special knowledge, otherwise you may waste your time and money. Once you decide to implement performance measurement framework, you need to choose the right business strategy. This is one of the main keys to the successful implementation of the BSC framework. The choice of strategic plan depends on several factors, as sphere of business you operate in, current business productivity, targeted goals, etc.Each company consists of a particular number of employees responsible for performing various business tasks. Since all members of the team unite their forces for the achievement of a single goal, make sure your personnel is aware of the essence of this framework and therefore is ready to perceive and use it. People must understand their role in the implementation of the new system. It can take some time until you see the first results, thus make sure your personnel realizes possible challenges and is ready to face them.Balanced Scorecard offers four perspectives for balanced and comprehensive business performance evaluation. This means, you will have to review your business in accordance with these perspectives. Though financial aspects play an important role in business management, you should not neglect the role on non financial indicators. BSC offers three non-financial aspects you need to evaluate to get the real picture of your company’s performance. Each perspective is measured by a particular set of key performance indicators (KPIs). Choosing suitable KPIs may be difficult. However, you will simplify this process by adopting ready to use templates. By surfing the Internet you will find KPI templates created for various industries.When creating a scorecard you need to keep in mind the actual goals of your organization. All steps related to BSC implementation should be thoroughly though over. You need to have a detailed and well-thought plan. In order to make timely and accurate improvements you need to monitor the received data on regular basis. Balanced Scorecard should be introduced at all business levels and become an essential part of your company’s philosophy.