Kaplan RS, Norton DP, et al.
Harvard business review. Date of publication 1992 Jan 1;volume 70(1):71-9.
1. Harv Bus Rev. 1992 Jan-Feb;70(1):71-9.
The balanced scorecard--measures that drive performance.
Kaplan RS(1), Norton DP.
Author information:
(1)Harvard Business School.
Frustrated by the inadequacies of traditional performance measurement systems,
some managers have abandoned financial measures like return on equity and
earnings per share. "Make operational improvements and the numbers will follow,"
the argument goes. But managers do not want to choose between financial and
operational measures. Executives want a balanced presentation of measures that
allow them to view the company from several perspectives simultaneously. During a
year-long research project with 12 companies at the leading edge of performance
measurement, the authors developed a "balanced scorecard," a new performance
measurement system that gives top managers a fast but comprehensive view of the
business. The balanced scorecard includes financial measures that tell the
results of actions already taken. And it complements those financial measures
with three sets of operational measures having to do with customer satisfaction,
internal processes, and the organization's ability to learn and improve--the
activities that drive future financial performance. Managers can create a
balanced scorecard by translating their company's strategy and mission statements
into specific goals and measures. To create the part of the scorecard that
focuses on the customer perspective, for example, executives at Electronic
Circuits Inc. established general goals for customer performance: get standard
products to market sooner, improve customers' time-to-market, become customers'
supplier of choice through partnerships, and develop innovative products tailored
to customer needs. Managers translated these elements of strategy into four
specific goals and identified a measure for each.
PMID: 10119714 [Indexed for MEDLINE]
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