Balanced Scorecard

Abstract

The purpose of the balanced scorecard is to provide a holistic perspective to setting firm goals and monitoring performance. The balanced scorecard provides a financial, marketing, operations, and human resources perspective of a firm’s performance. When used to implement strategy, the balanced scorecard approach prompts managers to think about what needs to happen in different elements of the business for the strategy to take hold. It encourages managers to think about how the strategy will impact the customer, operational, and people processes to ultimately affect financial results. This chapter discusses the underlying theory, core idea, depiction, process, insight or value created, and risks and limitations of the balanced scorecard. The chapter also continues the illustration of the Chocolate Moose and applies the steps of the balanced scorecard to this case.