Balanced scorecard is a well-known performance management tool that helps managers to keep track of the execution of activities by staff within their control and monitor the consequences arising from these actions. A balanced scorecard template can help management team from different levels to have a consistent framework and uniform style and format.
Balanced scorecard can help business track performance and ensure that the company's activities and procedures comply with policies and directions stipulated in the strategic planning. A balanced scorecard provides executives and managers with a method for reporting and analyzing key performance indicators to determine if operational activities are aligned with the company’s overall strategy and vision. The key feature of the Balanced Scorecard is the presentation of a mixture of financial and non-financial indicators. The report is a summary that captures the information most relevant to those reading it.
Balance scorecard capture all relevant information of company performance and put it in a strategic map. The indicators that Balanced Scorecard framework want to capture may fall into four areas: the financial, customer, internal process, learning and growth. the financial indicator covers the financial objectives of an organization and allows managers to track financial success and shareholder value. The customer indicator covers the customer objectives such as customer satisfaction, market share goals as well as product and service attributes. The internal process focuses on internal operational goals and outlines the key processes necessary to deliver the customer objectives. The Learning and Growth section gather information on the intangible drivers of future success such as human capital, organization capital and information capital including skills, training, organizational culture, leadership, systems and databases.
Research has shown that organizations that use a Balanced Scorecard approach tend to outperform organizations without a formal approach to strategic performance management. the Balanced Scorecard provides a powerful framework for building and communicating strategy. The business model is visualized in a Strategy Map which forces managers to think about cause-and-effect relationships. The process of creating a Strategy Map ensures that consensus is reached over a set of interrelated strategic objectives. Moreover the Balanced Scorecard approach forces organizations to design key performance indicators for their various strategic objectives. This ensures that companies are measuring what actually matters.
Balanced Scorecard Template
Template style: there is no strict format requirement for your balanced scored template. You can search around and find some free software that can help you design your template. However, in the sample balanced scorecard, you should include some key elements: finance, which include return on investment, internal business process, learning and growth and customer etc.
The first key area in balanced scorecard format is the strategic area or scope. In the section, you need to communicate and align the organization around a clear and concise strategy and determine the major strategic areas or scope for getting the organization focused on those things the organization can actually do.
The second key area in balanced scorecard example is to establish measurements. In the section, you need to give detail performance evaluation indicators. For each strategic objective, there needs to be at least one measurement. Measurement provides the feedback on whether or not we are meeting our strategic objectives.
The third key area in sample balanced scorecard is the expected targets. For each measurement in your scorecard, you need to give specific targets. For example, increase profitability of product line X from 10% to 20% by the end of the year.