Describe how the balanced scorecard with help management to identify information requirements.
A strategic planning and management systemwhich is used extensively in industry, business, government, as well as in nonprofit organizations worldwide to make straight business activities to the strategy and vision of organization, monitor organization performance against strategic goals and improve external and internal communications is known as balanced scorecard. It was invented by Drs. David Norton and Robert Kaplan as the performance measurement framework which can add strategic non-financial performance events to old-style financial metrics to provide executives and managers a more ‘balanced’ outlook of the organizational performance.
The balanced scorecard has go forward from its early usage as simple performance measurement framework to completestrategic planning as well as management system. Furthermore, the ānewā balanced scorecard changes organizationās strategic plan from attractive on the other hand passive document in the “marching orders” aimed at the organization on daily basis. It offers a framework which not only offers performance measurements, but helps planners classify what should be measured. It allows executives to truthfully execute their strategies. The balanced scorecard can be used for following perspective:
1.Ā The Learning & Growth Perspective
2.Ā The Business Process Perspective
3.Ā The Customer Perspective
4.Ā The Financial Perspective
“The balanced scorecard keeps traditional financial measures. But on the other hand financial measures tell story of past events, adequate story that is intended for industrial age companies for which funds in long-term capabilities as well as the customer relationships were not critical. These financial events are inadequate, for evaluating and guiding the journey to which information age companies must make to generate future value through investment in suppliers, processes, technology, employees, and innovation.”
