Executive Summary
This paper is organized to discuss the framework called the Balanced Scorecard (BSC), by Robert Kaplan and David Norton, translates an R2i's mission and strategy into a comprehensive set of performance measures that provides the framework for a strategic measurement and management system. The BSC was developed to measure both current operating performance and the drivers of future performance. The objectives and measures on a Balanced Scorecard should be derived from the business unit's strategy. A scorecard should contain outcome measures and the performance drivers of those outcomes. The scorecard measures organizational performance across a set of leading and lagging performance indicators grouped into four linked perspectives: financial, customer, internal processes, and learning and growth. Processing complex, unstructured information can be difficult.
The BSC enables R2i to track short-term financial results while simultaneously monitoring their progress in building the capabilities and acquiring the intangible assets that generate growth for future financial performance. The BSC enables managers to monitor and adjust the implementation of their strategy, and to make fundamental changes in the strategy itself. The BSC provides a representation of the organization's shared vision. The BSC communicates a holistic model that links individual efforts and accomplishments to business unit objectives. Thus, a shared vision and shared performance model, structured around the Balanced Scorecard, provides an essential element for a strategic learning process.
Since balanced scorecards can include many measures, this paper presents a methodology to help managers manage the complexity. The step-by-step process explained here can lead to accurate and consistent evaluations using both quantitative and qualitative performance measures, and makes R2i a