Unique Perspectives
A Balanced Scorecard is a management process that incorporates the examination of an organization across four perspectives:
> Human Capital (Learning and Employee Growth)
> Business Process
> Customer Viewpoint
> Financial Health
Strategic Management
The Balanced Scorecard is an approach to strategic management that was developed in the early 1990's by Drs. Robert Kaplan (Harvard Business School) and David Norton (Balanced Scorecard Collaborative). The system they defined is called the balanced scorecard. Their work recognized some the weaknesses inherent in a financial only perspective or in a system of disjointed measures where there is no balance between the health and results of an organization.
The balanced scorecard provides a means of examining the internal business processes as well as the external outcomes of an organization in order to continuously improve performance and results. When fully deployed, the balanced scorecard moves strategic planning and measurement from an ancilliary exercise to an active management discipline.
Drs. Kaplan and Norton describe the innovation of the balanced scorecard as follows:
"The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation."