This was created as performance measurement framework. This approach added strategic non-financial performance measures to the conventional metrics in finance. This offers executives as well as managers a balanced principle in organizational performance. The Balanced Scorecard is regarded as a tactical management and planning system that is generally utilized in several industries around the world. This includes areas such as non profit organization, business and government. The purpose of balanced scorecard that Kaplan and Norton designed is to enhance the external and internal communications and supervise the performance towards the organization ‘s strategic goals. This has greatly developed to a more comprehensive strategic management and planning system compared to the early use of simple performance measurement framework. This new Balanced Scorecard can develop the company ‘s plan into a marching order for the company. The balanced scorecard of Kaplan and Norton is an effective management system that helps companies identify clearly their strategy and vision. This will also help executives in implementing their strategies and vision for the company.
This gives feedback around external outcomes and internal business processes to enhance results and strategic performance. When these are completely set out, the Balanced Scorecard can change strategic planning to a nerve center of an organization. The Balanced Scorecard Kaplan and Norton created provides a framework that aids planners identify what needs to be measured and done. This does not just give performance measurements but it also allows mangers and executives to apply their strategies.