Defining Balanced Scorecard: A Methodology Worth Trying Out

The balanced scorecard methodology is a type pf technique that can analyze and translate the mission statement and overall strategy of business of any organization into a more quantifiable and specific goals. This methodology can also monitor the organizational performance of the company based in its capacity to achieve such goals. The balanced scorecard methodology was developed by Robert Kaplan and David Norton back in 1992 as a comprehensive approach that can assess the overall performance of any organization based on four perspectives. This is based on an idea that assessing the overall performance of any organization by means of financial returns can only provide data on how well it is able to perform before such an assessment; there is no indicator of future performance until a system can be devised to predict it and prepare the necessary plan of action to realize such a future.

The balanced scorecard methodology can examine performance in four different areas, namely financial analysis (often used in operating costs as well as return of investment measures), customer analysis (in charge of looking at the satisfaction and retention levels of the organization ‘s customers), internal analysis (focuses on production as well as innovation, working to measure performance by way of maximizing profit from its current products and following up on indicators for future productivity) and lastly, the learning and growth analysis (in charge of exploring the different effective practices of management in terms of measured employee satisfaction and retention as well as performance of information systems).