1. Is strategy important in your organization?
2. Is there value in communicating the strategy to the entire organization?
3. Do you want your employees motivated and prepared to execute the strategy?
If you answered yes to these questions, then your organization will benefit from implementing the Balanced Scorecard methodology. Some articles published by Robert Kaplan and David Norton in the Harvard Business Review between 1992 and 1996, the Balanced Scorecard is a business management concept that transforms financial and non-financial data into a detailed strategic map that helps to analyze the performance of organizations through medium and long term objectives.
Performance Management in general and Balanced Scorecard in particular, aim to monitor the key points of management in organizations. The vast majority of organizations do not translate the strategy into actions. This is the conclusion of a study by Renaissance Solutions in association with Robert Kaplan of Harvard Business School.
The opinion of some experts is that an effective understanding of the action-oriented organization's strategy can significantly influence its success in about 90% of the organizations studied. However, in the same study, less than 60% of directors and less than 10% of the organization's total believe that they had an unobstructed understanding of their strategy. Less than 30% of directors who implemented their organization's strategy believed it had been implemented effectively.
WHAT ARE THE BSC BENEFITS
Currently, leaders of large organizations use the Balanced Scorecard to monitor, control and measure their strategic and operational performance. The Balanced Scorecard is a solution that provides a range of key benefits, such as:
Alignment of strategy with key business objectives at all levels of the organization
More than 90% of organizations do not effectively align their strategy across their organization. The result is an organization that is not operating at maximum efficiency, leading to more modest performance and the loss of business opportunities. With the Balanced Scorecard the organization can analyze each business unit, being able to control the key indicators and visualize in a global plan what impact it has in terms of the organization's performance.
More efficiency in business management and control
The Balanced Scorecard provides a strategic view of operations to all business units, allowing you to easily monitor and understand how organizations are progressing against what was planned. It allows organizations to create key initiatives for the development of the business as well as act in problematic areas or monitor business opportunities. In this way, the directors have at their disposal a solution that allows them to carry out more effective management and, consequently, better manage resources.
Highly effective strategic platform to communicate the strategy in your organization
The automation of a Balanced Scorecard offers the organization a current platform and allows sharing and communicating all crucial information throughout the organization. With the Balanced Scorecard, you can identify problems earlier and track business opportunities more quickly and more effectively than traditional management models.
Maximize IT investment
Most organizations have significant investments in Data Warehouses, Data Marts as well as in OLAP and ERP systems. These back-office systems are the organizations' preliminary data source. A Balanced Scorecard solution, as a strategic analytical application within an organization, must work in harmony with the existing data sources, extracting and channeling the information to the scorecards.
More about the Balanced Scorecard - BSC v10 Solution