BALANCED SCORECARD

The balanced scorecard is a strategic planning and management system that is used extensively in business and industry, government, and non profit organizations worldwide to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organization performance against strategic goals.

DESIGN
Design of a Balanced Scorecard ultimately is about the identification of a small number of financial and non-financial measures and attaching targets to them, so that when they are reviewed it is possible to determine whether current performance 'meets expectations'. The idea behind this is that by alerting managers to areas where performance deviates from expectations, they can be encouraged to focus their attention on these areas, and hopefully as a result trigger improved performance within the part of the organization they lead. This is illustrated well by the four steps required to design a Balanced Scorecard:

Translating the vision into operational goals; Communicating the vision and link it to individual performance; Business planning; index setting Feedback and learning, and adjusting the strategy accordingly.

FEATURES
Objectives: This reflects the organization's objectives such as profitability or market share.
Measures: Based on the objectives, measures will be put in place to gauge the progress of achieving objectives.

Targets: This could be department based or overall as a company. There will be specific targets that have been set to achieve the measures.
Initiatives: These could be classifies as actions that are taken to meet the objectives.

THE NEED FOR A BALANCED SCORECARD

Following are some of the points that describe the need for implementing a balanced scorecard. Increases the focus on the business strategy and its outcomes. Leads to improvised organizational performance through measurements. Align the workforce to meet the organization's strategy on a day-to-day basis. Targeting the key determinants or drivers of future performance. Improves the level of communication in relation to the organization's strategy and vision. Helps to prioritize projects according to the timeframe and other priority factors.

UTILISING THE BALANCED SCORECARD AS A STRATEGIC MANAGEMENT TOOL

CONCLUSION
Gives an overall picture. Determines the health of short term, medium term and long term objective at one glance. Checks whether implemented action matches the desired outcome or not. It is important to balance between innovation and quality improvement initiatives it ensure that balance. Metrics are not applicable to the actual situation sometimes. These four area do not paint the overall picture. It takes forethought.