During the 1980 ‘s, a lot of businesses were using Total Quality Management principles. Some were successful in it however, some have failed. They have realized that Total Quality Management processes seemed to focus on isolated projects which are not directly related to intended goals. Due to this, Robert Kaplan and David Norton studied how organizations are supposed to overcome this conflict. They have thought of ways and methods on how to use it to improve the management system. And so the Balanced Scorecard concept existed.
So what is the balanced scorecard concept anyway? Well, it is an approach which recommends that businesses should look into the performance with several indicators. The company should not only focus on the financial aspect or the commercial factors that are on top. It should be able to find out the cause and effect relationships between the factors involved in the project. Broader aspects should be taken into consideration. The financial stakeholders are not the only one involved in an organization. The clients, management, as well as the employees are part of it. Thus, the organization should work hand in hand to obtain the goals. The financial as well as the internal processes should be organized and be part of a certain perspective. Organizational goals vary from one company to another. The balanced scoreboard non profit perspective is applicable to governmental organizations, healthcare systems and nonprofit associations.
Whatever organization you are involved in, you should make sure that your company follows a set of rules and find ways to achieve the goals and objectives without wastage. Moreover, methods and business strategies would be very useful.