Balanced Scorecard
1.0 Introduction
In many ways, today’s business environment has changed qualitatively since the late 1980s. In just a few short years, Globalization has started a variety of trends with profound consequences: the opening of markets, true global competition, widespread deregulation of industry, and an abundance of accessible capital. Began to breakthrough on information technology perspective have changed the capacity to manage business independent through the traditional system restriction of space or time.
From past to now, traditional performance measure system focus on ‘Financial Performance’ and usually ignore the other aspects of performance and evaluation like Financial; Customer; Internal Business Processes and Learning and Growth. The weakness of adopting a financial performance is accounting methodologies as follow:
“Certain financial analysis may be adversely affected by a company’s accounting methodologies. For example, accelerated depreciation may overstate the true depreciation cost to the company. Debt may be financed through various subsidiaries or off-balance sheet accounts. Thus, when reviewing the results of a financial analysis, an analyst must be aware of the financial accounting methodologies employed by the company. These are often discussed in the notes to the financial statements”. (By Jason P. Browning, eHow Contributor.)
It is because traditional financial accounting system only can estimate matters happened in the past, but cannot evaluate forward-looking investment enterprise, therefore, should use change the department sight for a group of architecture from four aspect performance index to assess the performance of the department. So, the perfect performance management system of Balanced Scorecard (BSC) is work out by the Robert Kaplan & David Norton in 1992.
2.0 Balanced Scorecard Defined
A Balanced Scorecard is a performance management tool used by executives and managers to manage the execution of organizational
In many ways, today’s business environment has changed qualitatively since the late 1980s. In just a few short years, Globalization has started a variety of trends with profound consequences: the opening of markets, true global competition, widespread deregulation of industry, and an abundance of accessible capital. Began to breakthrough on information technology perspective have changed the capacity to manage business independent through the traditional system restriction of space or time.
From past to now, traditional performance measure system focus on ‘Financial Performance’ and usually ignore the other aspects of performance and evaluation like Financial; Customer; Internal Business Processes and Learning and Growth. The weakness of adopting a financial performance is accounting methodologies as follow:
“Certain financial analysis may be adversely affected by a company’s accounting methodologies. For example, accelerated depreciation may overstate the true depreciation cost to the company. Debt may be financed through various subsidiaries or off-balance sheet accounts. Thus, when reviewing the results of a financial analysis, an analyst must be aware of the financial accounting methodologies employed by the company. These are often discussed in the notes to the financial statements”. (By Jason P. Browning, eHow Contributor.)
It is because traditional financial accounting system only can estimate matters happened in the past, but cannot evaluate forward-looking investment enterprise, therefore, should use change the department sight for a group of architecture from four aspect performance index to assess the performance of the department. So, the perfect performance management system of Balanced Scorecard (BSC) is work out by the Robert Kaplan & David Norton in 1992.
2.0 Balanced Scorecard Defined
A Balanced Scorecard is a performance management tool used by executives and managers to manage the execution of organizational