Strategic Management Tools: Balanced Scorecards

Balanced Scorecard is an effective strategic management tool often employed by organisations to measure and evaluate performance. There are three major reasons why organisations measure performance: to motivate behaviour, to support decision making, and to signal stakeholders. Based on this, scorecards can be classified into three different types:

• Strategy scorecards are used for target setting and accountability and are derived from the vision and strategy of an organisation. Strategy maps translate strategy into action. Cascading measures bring it to the relevant organisational levels. 
• Key Performance Indicators (KPIs) scorecards are used to support decision making and can include both controllable and non-controllable measures. 
• Stakeholder scorecards are used to signal stakeholders.

Balanced Scorecard is an integrated performance-measurement system which tracks a set of financial and non-financial measures balanced around four stakeholder perspectives: 

• financial, 
• customer, 
• internal, and 
• learning and growth.

There is a multitude of various performance measures suitable for various objectives. The challenge lies in selecting SMART measures. Professional Business Plans adopted Specific, Measurable, Achievable, Relevant and Time-based criteria as its SMART principals for measures selection. 



Julia Podgorbunskaya, CPA, Head Planner at Professional Business Plans
​May 2018

(61) 02 4295 0079
Julia@ProfessionalBusinessPlans.com.au
www.ProfessionalBusinessPlans.com.au