Look at the business / career from
four important perspectives
Chapter 10
p.6
Balanced Scorecard? I think I've heard of it somewhere.
Think of the Balanced Scorecard as the dials and indicators in an airplane cockpit. For the complex task of navigating and flying an airplane, pilots need detailed information about many aspects of the flight, like fuel level, airspeed, altitude, bearing, etc.
Obviously, relying on only one instrument can prove to be fatal... Similarly, the complexity of managing an organization like our company requires that managers be able to view performance in several areas simultaneously.
The balanced scorecard allows managers to look at the business from
four important perspectives.
It provides answers to four basic questions:
How do customers see us? (Customer perspective)
What must we excel at? (Internal perspective)
Can we continue to improve and create value?
(Innovation and learning perspective)
How do shareholders view us?
(Financial perspective)
Financial Perspective:
How do shareholders
view us?
Investment
Cash flow
Gross margin/
Contribution
Business profits
Budget and profit
forecast reliability
Back order book
Debtor days
Customer
perspective:
Cost/benefit
Customer ranking
Survey
Customer
satisfaction index
Market share
Value added to
customer's
customer
Internal business
perspective:
Effectiveness
Service
Differentiation
Technology
Capability
Commercial
processes
Team competence
Black
empowerment
Innovation and
learning perspective:
Can we continue to
improve and create
Contribution
HR Survey
Contribution per
employee
Continuous
improvement
Skills
development in
products and
Services
Keep in mind that a customer may stop buying from you for other reasons than product,
price and service.
How many mistakes can you make on an invoice, or deliver late, before your customer finds another supplier?
