The BSC is a planning & management system which can be widely applied to organizations and companies regardless of size or type of business. The technique, extensively used in business and industry, government, and non-profit organizations worldwide, provides a method of aligning business activities to the vision & strategy of the organization, integrating internal & external communications, & keeping a watch on organization performance against strategic goals. It was developed by Robert Kaplan and David Norton of Harvard University in 1990. The line of the balanced scorecard runs deep, and include the revolutionary and path breaking work of General Electric on performance measurement coverage in the late 1950’s and the work of French engineers in the early part of the 20th century in France.
Due to the fact that balanced scorecard term is a generic, it is interpreted differently by different people, and in practice, there are wide variations in both understanding and implementation. To some, the balanced scorecard is just a simple control panel indicating performance measures, while to others it is a inclusive planning and management system encompassing the whole organization and planned to focus efforts on business strategy and more significantly on performance and results.
The balanced scorecard has steadily developed from its early use as a simple performance measurement framework for non-financial performance measures to a full strategic planning and management system. The “new” balanced scorecard transforms an organization’s strategic plan from an attractive but passive document into the "marching orders" for the organization on a daily basis. It provides a framework that provides performance measurements and also helps planners identify what should be done and measured. It enables executives to implement and execute their…...