Balanced Scorecard

Balanced Scorecard, or BSC, is a tool used to manage the company's development performance. The system is developed by Robert Kaplan and David Norton. The main purpose of the BSC concept is to bring the company's vision into reality, i.e., to relate strategy with operating activity and cost.

In BSC the company's activities are considered within four perspectives (Figure 1):

  • Financial perspective;
  • Customer perspective;
  • Internal process perspective;
  • Learning and growth perspective.
Figure 1. BSC perspectives

The essence of BSC is to develop the strategy within multiple perspectives, set strategic objectives, and assess the degree of objective achievement with measures. The word “balanced” in the methodology's name means:

  • the balance between conflicting objectives (e.g., “Fast, Cheap and Qualitatively” or “Increase Profit - Increase Capitalization”) and
  • the balance between financial and non-financial measures. According to BSC, it is not possible, for example, to invest the entire existing budget into attraction of new customers and leave no finance for training the personnel.

Success is achieved due to a balanced strategy. The BSC is further spread to the entire organization and individual objectives are developed for employees taking corporate strategy into consideration.


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