The Balanced Scorecard As a Strategic Planning Tool

The Balanced Scoreboard provides a framework to translate vision and strategy into operational objectives that drive both behavior and performance.

A. It is a strategic planning model that encompasses and measures intangible and intellectual "assets" in addition to the financial aspects of an organization

• High quality products and services

• Motivated and skilled employees,

• Responsive and predictable internal processes

• Satisfied and loyal customers

These intangibles are the drivers that add value to financial results.

B. Financial measures tell the story of the past performance. Measuring the intangibles helps create future performance through investment in customers, suppliers, employees, processes, technology and innovation.

C. The Balanced Scorecard emphasizes that financial and non-financial measures must be part of the information system for employees at all levels. Front-line employees must understand the consequences of their decisions and actions.

D. For government organizations the mission (rather than the financial/shareholder objectives) drives the organization's strategy.

E. It is a balance between the objective, easily quantified outcome measures and the subjective, somewhat judgmental performance drivers of the outcome measures.

F. The Balanced Scorecard creates consensus among senior executives by specifying the objectives and measurements of goals and strategies. Everyone understands what the critical drivers of success are.

G. It goes beyond the traditional performance measures of improving cost, quality and cycle times of existing processes. It highlights those processes that are most critical for achieving breakthrough performance for customers and may reveal entirely new internal processes that the organization must excel at for its strategy to be successful.

H. To be successful it must be driven by leadership.