A study on the balanced scorecard as an effective performance management system
Summary :
Table of Contents
- Introduction: What is Balanced Scorecard?
- History
- Methodology
- Kaplan & Norton's model
- 2nd Generation model
- 3rd Generation model
- 4th Generation model
- Uses of the balanced scorecard
- How to implement
- Criticisms
- Critical factors for success
- Conclusion
- References
Abstract
The balanced scorecard is a strategic planning and management system used to align business activities to the vision and strategy of the organization. In other words, it translates the vague statements and undefined aspirations of a company's vision or mission statement into practical components of performance required at every level of the organization. It takes a holistic view of the organizations and facilitates effective co-ordination between the various departments to achieve common organizational objectives and goals, and is therefore a performance management tool for measuring whether the smaller-scale operational activities of a company aligns with its larger-scale objectives in terms of vision and strategy. The roots of the balanced scorecard approach traces back to the pioneering work of General Electric on performance measurement reporting in the 1950's, and the work of French process engineers who created the "Tableau de Bord" or a dashboard of performance measures in the early part of the 20th century. The concept also has similarities to the activity based costing methods, a costing model that identifies activities in an organization and assigns the cost of each activity resource to all products and services according to the actual consumption by each
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