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Performance Drivers a Practical Guide to Using the Balanced Scorecard

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					Balanced Scorecard: Translating Strategy into Action
Robert S. Kaplan and David P. Norton (1996)


Why Read It?
 •     The originators of the Balanced Scorecard present this innovative methodology, and show how
       managers can use it to maximize the potential of their companies.
 •     Details how to build a Balanced Scorecard specifically tailored to an organization, and provides the
       practical tools needed for implementation.
 •     Describes the impact of using a Balanced Scorecard as a strategic management system, and how it
       helps clarify both vision and strategy and translate them into action.


Getting Started
Balanced Scorecard focuses on how to successfully execute business strategy using this management
model, and provides a guide to building a Balanced Scorecard. It puts in place a new management system
for companies to re-focus on the long term for customers, employees, new product development, and
systems, rather than concentrating just on short-term profit. It bridges the gap between strategic goals and
performance monitoring, and has been implemented by over 300 major organizations.


Authors
Robert S. Kaplan (b. 1940) is Professor of Leadership Development at Harvard Business School, and
Chairman of the Balanced Scorecard Collaborative. He has previously been on the faculty and Dean of the
business school at Carnegie Mellon University, and has received numerous awards.
David P. Norton is co-founder and President of Palladium Group. He has also been President of
Renaissance Solutions, co-founded and served as President and CEO of the Balanced Scorecard
Collaborative, and co-founded and was President of Nolan, Norton & Co.


Quotations
“The Balanced Scorecard…provides managers with the instrumentation they need to navigate to future
competitive success.”
“The Balanced Scorecard complements financial measures of past performance with measures of the drivers
of future performance.”
“The Balanced Scorecard fills the void that exists in most management systems—the lack of a systematic
process to implement and obtain feedback about strategy.”


Context
 •     Shows how the Balanced Scorecard works as a measurement and management system for channeling
       the potential, skills, and knowledge of people towards realizable long-term goals.
 •     Emphasizes financial results and the human issues that drive them, by integrating a customer
       perspective, an internal perspective, and a learning and growth perspective.
 •     Examines the importance of employee learning and growth, internal business processes, and customer
       knowledge, rather than just short-term financial gain.
 •     Considers how the scorecard facilitates management processes such as individual and team goal
       setting, compensation, resource allocation, budgeting and planning, and strategic feedback and
       learning.


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 •     Analyzes how the scorecard has innovated some of the concepts of previous management models
       such as Total Quality Management.


Impact
 •     Demonstrates how senior executives are using the Balanced Scorecard to guide current business
       performance and putting in place targets for future performance.
 •     Focuses on the vision and strategy of a business, and provides managers with a comprehensive
       overview of financial performance.
 •     Shows how to use measures for financial performance, customer knowledge, internal business
       processes, and learning and growth.
 •     Considers how the Balanced Scorecard evolves with the organization, unlike many other business
       models.


More Info
Books:
 •     Kaplan, Robert S., and David P. Norton. The Strategy-Focused Organization: How Balanced
       Scorecard Companies Thrive in the New Business Environment. Boston, MA: Harvard Business
       School Press, 2001. Explains how companies have used the Balanced Scorecard approach over
       nearly 10 years, and shows how others can implement it successfully.
 •     Niven, Paul R. Balanced Scorecard Step-by-Step: Maximizing Performance and Maintaining Results.
       New York: Wiley, 2002. Provides practical insight on how best to implement the Balanced Scorecard,
       based on the author’s experience in many organizations.
 •     Olve, Nils-Göran, Jan Roy, and Magnus Wetter. Performance Drivers: A Practical Guide to Using the
       Balanced Scorecard. Chichester, UK: Wiley, 1999. An overview of Balanced Scorecard practice.

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