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Harness the power of the balanced scorecard and optimise your business performance

Posted by Nicky Hawkins on Jul 24, 2019 3:10:26 PM

oHarness the power of the balanced scorecard and optimise your business performance

Kaplan & Norton's Balanced Scorecard model was developed in the early 1990's at Harvard University as an attempt to help organsisations measure business performance using both financial and non-financial data. When used correctly and consistently, it offers invaluable assistance in identifying improvement potentials, setting concrete goals, and tracking your progress towards achieving and surpassing them. The balanced scorecard is, thus, a powerful tool for translating your overarching goals and mission into traceable actions.

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With the help of our state-of-the-art Strategy and Performance Suite, equipped with various relevant modules, you can make a head start in boosting your company's performance. In the following, we demystify the balanced scorecard and show you the great potential for your business if you apply it correctly.

From strategy to strategic objectives and actions

Every company has a mission statement and a strategy. These point it in a general direction, but they offer little in the way of concrete measures. Therefore, the balanced scorecard requires the formulation of strategic objectives, or those short-, medium- and long-term activities that lead to the practical implementation of the company's strategy.

Examples of strategic objectives are 'increase quarterly revenue by X%, 'improve post-sales customer relationship management', or 'make our programmes more cost-effective'. Following the formulation of your strategic objectives, you will implement particular actions aimed at achieving those objectives.

The balanced scorecard then helps you track each action's effectiveness by monitoring relevant key performance indicators. KPIs are great for continuous observation and evaluation of achievements, for motivating employees, and for establishing a common language across the company hierarchy as you all work together towards the specific goals. A well-designed software package is invaluable for this process of extended appraisal, feedback, and adjustment. It can take the guesswork out of strategic action and greatly reduce uncertainty, leading to improved performance.

Bringing all vital perspectives into one powerful report

Arguably the greatest feature of the balanced scorecard is its comprehensiveness: It covers all aspects of a company's operations and brings them together into a single report. This allows managers to devise long-term strategies and to monitor progress towards specific goals continuously and globally.

In this way, the scorecard prevents sub-optimisation, or the inefficient practice of solving one problem at the expense of creating another. In some cases, a simple cost-cutting measure in product development that can reduce the time to market may seem like the right choice, but the sacrifice in product complexity or USP can have dire consequences for sales. Relying on the balanced scorecard, with the support of a smart software package that integrates data in real time and presents it in digestible, actionable format, managers can develop achievable strategies for future growth.

Automating your balanced scorecard for continuous performance improvements

Thanks to advanced software suites like the various modules by Clearview Systems, it is possible to automate a significant portion of the implementation processes around the balanced scorecard and free up resources for further strategic development.

Once you have designated your strategic objectives and implemented the respective actions, your company's performance data can feed directly into our performance-management application that will do the monitoring and notifications to key team members as needed.

See the benefits for yourself

To experience the empowerment of the balanced scorecard with the support of Clearview Systems, book a software demo today, and be sure to try out our efficiency and benefits calculator for a direct measure of how much better your company could be doing.

Image source: Pixabay

Click here to view our business efficiency and benefits calculator

Topics: Performance management

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