Companies often commit a lot of time, energy and resources to the formation of a strong business strategy. However, if you fail to execute the plan, everything is being wasted. A strategy is only valuable if it helps you obtain results, and it’s possible you simply don’t have the right tool in place to assist you in turning the company’s vision into a reality. That’s where the balanced scorecard comes in.
What is a Balanced Scorecard?
The concept of the balanced scorecard was created during a joint partnership between Dr. Robert S. Kaplan and Dr. David P. Norton, of Harvard University and the University of Florida, respectively. This strategic planning and management tool is designed to help companies stay on target by defining strategic priorities and creating indicators to examine the execution phase.
The scorecard encourages businesses to explore issues from four key perspectives: learning and growth, business process, customer, and financial. Each of these can be adjusted to reflect certain aspects of the organization, allowing for a more customized approach.
Making the Most of the Balanced Scorecard
To get the most out of this tool, you need to be specific when creating metrics. While a generic approach is easier, it won’t necessarily provide you with the information you want or propel the business forward.
You also want to craft a performance index that can help familiarize employees and managers at all levels. This involves identifying important performance indicators and determining how stakeholders define satisfaction with an outcome. Adding goals and milestones is also beneficial.
Strategy should be on the forefront of everyone’s mind, so it is imperative to educate everyone on the associated goals. The balanced scorecard makes this process simple and can help ensure workers from top to bottom learn to think more strategically as they complete their assigned tasks.
Both the balanced scorecard and overall business strategy are designed to be long-term initiatives, not quick fixes. By assuming that perspective, it is easier to take high-level goals, visions, and values and include them in the process. Plus, the longer the balanced scorecard is in use, the more invested employees will become in the system, making it easier to coordinate future efforts using the same methods.
Help is Out There
There are a variety of tools, references, and examples of balanced scorecards available today. These make it easier to institute this method in your own company while lowering the learning curve. By taking this approach, you can quickly demonstrate and monitor strategic priorities within your business and make the information accessible to everyone in your organization.
If you would like to learn more about the balanced scorecard, the professionals at The Squires Group have the expertise you need to succeed. Contact us to see how our services can be a valuable component of a successful business strategy at your company.
