Dönemindeki benzerlerinden farklı olarak, yalnızca finansal göstergeleri baz almayan, daha kapsamlı ve yeni bir performans ölçüm yöntemi geliştirilmiştir. Kitap, yazarların 1990 yılından itibaren yapmış oldukları çalışmalara dayanmaktadır. Yazarlar, uyguladıkları strateji ve vizyon bütününe kurumsal karne ya da dengeli ölçüm karnesi İngilizce: balanced scorecard tekniği adını vermişlerdir. “Balanced Scorecard” tekniği, bir şirketin performansını değerlendirirken, dengede olması gereken dört boyutu inceler:
Finansal boyut, Müşteri boyutu, İç verimlilik boyutu, Öğrenme ve gelişme boyutu.
Yazarlara göre, uzun dönemli stratejiler geliştirmek ve uzun dönemli başarıyı garantilemek için yalnızca kısa dönemli finansal göstergelere dayanarak hareket etmek yeterli olmayacaktır. Kaplan ve Norton, ilk aşamada kurumsal karne için teorik temelleri sağlamayı; ikinci aşamada, işletmelerin kendi karnelerini oluşturmak için atmaları gereken adımları belirlemelerini ve nihayet bu oluşturdukları karneyi gelişerek değişmek için nasıl kullanacaklarını tartışmalarını önermektedirler. Zaman içinde geliştirilen sistem, günümüzde birçok dev şirkette "Strateji belirleme ve stratejiyi uygulama" amacıyla kullanılmaktadır.
This is the most important boring book I've ever read. The book laboriously tells you some simple things. Despite this, it is vital that you read the book and not assume that a synopsis will suffice. But .. man .. it's dull.
The balanced scorecard approach looks not just at the performance of a business, but at its planning, its transparency, and its history. I've used this for non-profits, for businesses, and for personal life-goals.
One of the biggest problem in management is that Business Strategy is always good on paper but not in the real world. This is because Business Strategy is made in the board room, isolated from the real world that is the front line and once this strategy is handed down from the top, frontline executives are at a lost on how to execute such a strategy. Balanced Scorecard as a framework links this Strategy – Performance gap. Norton and Kaplan’s other book, “Strategy Map” deals with the development of an “executable” strategy while this book provides the framework for monitoring and controlling of the “performance of strategy”. The book is not for everybody though. Definitely, this is not a book that a non – business or for that matter, even an occasional business reader could appreciate. This is a hard core business book that is most appropriate for those who understand the nuances of Strategy making, Implementation, and Performance management.
Some years ago I was exposed to a suboptimal implementation of the Balanced Scorecard. Because of that, I came to this book with prejudices, and the beginning was really hard--I postponed reading the book and found other things to do instead. If I hadn't needed to do the research for class, I would have steered far away from anything to do with the BSC. (I initially suggested a variety of different topics in lieu of the BSC, trying to get out of having to read what I thought was a load of rubbish, but my professor would have none of it.)
I struggled with the book for two or three chapters. I was still in thrall to my biases, and the theoretical nature of the book had no appeal.
The a-ha moment came when a class assignment involved a case study where a company had implemented the BSC but hadn't done a great job of it. Although I was only one-third of the way through this book at the time, I immediately saw the most obvious problems with the BSC the case study was using. With a concrete problem in need of a solution before me, I was able to apply the concepts I learned in just the first few chapters of the book and analyse the case study successfully to come up with some good recommendations. In comparison, my classmates who hadn't read the book (or even heard of it) and had only read one article on the BSC were struggling with the concept.
Now that I understand the theory of the BSC, I think I can see what happened, what went wrong, how to fix it, etc. Most of all, the BSC as written is optimized for large businesses, but the general principles can apply to small shops as well (in a less formal process, of course.)
Luv this book. Thx to my lecture Mr. Ali Djamhuri who shared this book to me 11 years ago. I have both english and indonesian :-). Either than traditional ways, this book give me a comprehensive way to measure and manage organization from 4 perspectives, financially and non financially. For me, on top of all, i love the fact that BSC also applicable on not for profit organization.
Best book ever on business execution. Whole bundle of common sense. It gives an idea as why a Kaizen event or a CI team can't fix a company which does not have a focus and foundation to work on it.
The book's approach is to capture the performance of four key aspects of a business - Financial, Customer, Internal process and Learning - on one top down flowing scorecard.
The company would need to work on its basics - a vision, mission, strategies, key lag and lead measures to activate this card. The book recommends a 16 week homework. This framework then unites a CEO to the shop floor making them as one synchronised unit. With this setup the domino of a focused action Kaizen or whatever on the floor supporting the respective lead measure of the department can be seen rolling visibly impacting the plants strategy.
This book along with 4DX from Franklin Civey can be a potent combination to run a business effectively. Highly recommended 👌
Takeaways
Financial - Top down breakup of measures from strategy to smallest units based on cause and effect principle
Customer - Focusing on the right customer segment with highest profitability
Internal process - Optimising a value chain of Innovation, Production and delivery for best impact on time, cost and quality
Learning - Skill matrix to facilitate the execution in the other three perspectives
Other focus: Capex allocation and Incentive plan based on impact to strategy, Strategy feedback loop to ensure correct navigation to true North, CI for Financial measures and strategy initiatives for radical measures, Importance of Data capturing to find and run the right measures
It's a comprehensive book with extremely detailed case studies. But the academic writing makes it really hard to follow, especially when different terms are used to describe the same concept in different sections or sub-sections, making it hard to connect the dots.
Although there’s a summary at the end of each chapter, the summaries are often too vague to be of much use. There wasn't even a basic definition of terms like Objectives, Measures, Initiatives etc. used in the book. Granted, it was one of the earlier publications of the Balanced Scorecard, and the concept has since been refined and improved many times over.
In terms of the concept and framework, it's does seem relatively comprehensive, but I find the case studies a bit unintuitive and hard to follow, despite all the details packed in there.
I found the OKR approach in Radical Focus a lot simpler to grasp, though I get it that these 2 frameworks are addressing different aspets of strategy implementation. OKRs are more for listing down the top objectives/metrics and cascading them downward/upward, whereas the BSC covers the business strategy more thoroughly, and shows the connections and relationships between different objectives.
Still, I found this book really useful as an overall framework for breaking down strategy into sub-areas. Shall attempt to combine it with the OKR approach that I'm now testing out in my business :)
As the title indicates, this book introduces the concept of the Balanced Scorecard: "The Balanced Scorecard (BSC) provides managers with the instrumentation they need to navigate to future competitive success. Today, organizations are competing in complex environments so that an accurate understanding of their goals and the methods for attaining those goals is vital. The Balanced Scorecard translates an organization's mission and strategy into a comprehensive set of performance measures that provides the framework for a strategic measurement and management systems. The Balanced Scorecard retains an emphasis on achieving financial objectives, but also includes the performance drivers of these financial objectives. The scorecard measures organizational performance across four balanced perspectives: financial, customers, internal business processes, and learning and growth. The BSC enables companies to track financial results while simultaneously monitoring progress in building the capabilities and acquiring the intangible assets they need for future growth."
The authors then go on to presenting each of the four perspectives in details and discuss how the Balanced Scorecard measures link to the strategy. In the subsequent section, the authors focus on how the Scorecard is used to manage business strategy. The framework presented revives the traditional thinking around strategy and how it is implemented in a very pragmatic manner - balancing both strategy and its associated execution. What I particularly enjoyed are the numerous case studies and examples presented that help anchor the concepts.
A classic must read in the area of Corporate Strategy!
Below are key excerpts from the book that I found particularly insightful:
1- "The Balanced Scorecard emphasizes that financial and nonfinancial measures must be part of the information system for employees at all levels of the organization."
2- "As more and more companies work with the Balance Scorecard, they see how it can be used to:
-clarify and gain consensus about strategy,
-communicate strategy throughout the organization,
-align departmental and personal goalts to the strategy,
-link strategic objectives to long-term targets and annual budgets,
-identify and align strategic initiatives,
-perform periodic and systematic strategic review, and obtain feedback to learn about and improve strategy."
3- "A strategy is a set of hypotheses about cause and effect. The measurement system should make the relationships (hypotheses) among objectives (and measures) in the various perspectives explicit that they can be managed and validated."
4- "The financial objectives serve as the focus for the objectives and measures in all the other scorecard perspectives. Every measure selected should be part of a link of cause-and-effect relationships that culminate in improving financial performance."
5- "The scorecard should tell the story of the strategy, starting with the long-run financial objectives, linking these to the sequence of actions that must be taken with financial processes, customers, internal processes, and finally employees and systems to deliver long-term economic performance."
6- "In the internal-business process perspective, managers identify the critical processes at which they must excel if they are to meet the objectives of shareholders and of targeted customer segments...One recent development has been to incorporate the innovation process as a vital component of the internal-business-process perspective."
7- "While not the same as measurement, and not a long-term substitute for measurement, the text is a marker that serves many of the same objectives as a formal measurement system."
8- "Balanced Scorecard of no more than two dozen measures can be sufficient for measuring their operations. They are, of course, correct in a narrow sense, but they fail to distinguish between diagnostic measures - those measures that monitor whether the business remains in control and can signal when unusual events are occurring that require immediate attention - and strategic measures - those that define a strategy designed for competitive excellence."
9- "The Balanced Scorecard is not a replacement for an organization's day-to-day measurement system. The scorecard measures are chosen to drive the attention of managers and employees to those factors expected to lead to competitive breakthroughs for an organization."
10- "The disconnect between strategy formulation and strategy implementation is caused by barriers erected by traditional management systems - the systems organizations use to:
-establish and communicate strategy and directions;
-allocate resources;
-define departmental, team, and individual goals and directions; and
-provide feedback."
11- "The scorecard provides a common framework for organizing the planning process of corporate support departments. It enables these departments to understand the strategies of the entire corporation and the individual SBUs so that the support departments can develop and deliver better services that help the operating units and corporation achieve their strategic objectives."
12- "Strategic planning and operational budgeting processes are too important to be treated as independent processes. Strategic planning must be linked to operational budgeting if action is to be tied to vision."
13- "Mintzberg and Simons identify key aspects of this newer or emergent view of strategy:
-Strategies are incremental and emerge over time
-Intended strategies can be superseded
-Strategy formulation and implementation are intertwined
-Strategic ideas can arise throughout the organization
-A strategy is a process"
14- "...the measurement framework in the Balanced Scorecard should be deployed to develop a new management system. The distinction between a measurement and a management system is subtle but crucial. The measurement system should be only a means to achieve an even more important goal - a strategic management system that helps executives implement and gain feedback about their strategy."
15- "Most companies introduce the scorecard to drive single pieces of the management process: Obtain clarity and consensus about strategy, achieve focus, leadership development, strategic intervention, educate the organization, set strategic targets, align programs and investments, build a feedback system."
Şirketlerde performans yönetimi kısıtlı imkanlarla yapılan, genelde de hiç başlanmamış olan bir olgudur. Balanced Scorecard, tüm yönetim kademeleri için yukarıdan aşağıya bir hiyerarşi ile birlikte şirket vizyonunun tüm personellere uygulanmasını ve bilinç oluşturulması için geliştirilen Robert S.Kaplan'ın geliştirdiği bir sistem. Personellere şirket vizyonu dahilinde verilen (kademelerine göre) KPI'lar ile ölçülebilir bir performans yönetimi gerçekleştirebilme amacı ile yazılmış kitap. Örneklerde, bugüne kadar kullandığı sistemleri, birkaç ayrı sektör ile birlikte çeşitlendirmiş. Müthiş bilgiler yok, zaman zaman çeviri yoruyor. Ancak bu konuya çok uzak olanları bilgilendirebilir, hali hazırda bu sisteme benzer bir sistem uygulayanlara ise ekstra bir katkısı yok. Bir kaç noktada danışmanlıktan kalma pazarlama, yönetim bilgisi öğrenebilirsiniz sadece.
The preface of the book tells us that it is the result of a one-year multicompany study spearheaded by the Nolan Norton Institute, which is the research arm of KPMG. This study delved into the statement that reliance solely on financial performance measures was hindering companies to achieve their full potential, leading to the expansion of these performance measures to include 4 different perspectives: financial, customer, internal and innovation/learning. This was charted using a “Balance Scorecard” reflecting these dimensions. This book elaborates on the study in order to help us to a tool for successfully managing companies.
Excellent articulation of one of the best strategic management tools. The authors provide detailed examples of different aspects of the scorecard from different industries.
I realize that OKRs is actually born from here.
The only challenge for this book is that it is written from a manufacturing industry perspective more than today's internet age. This can't be helped as it was written at a time when no one could predict what would happen out of the internet. Nevertheless, there are many lessons that can be applied with a bit of thought to any industry.
Very effective strategy -- for translating strategy into action. This book delivers on the title very well. This is a necessity for teams at scale, but will be valuable in any type of organization. For product development teams -- this is one of the best frameworks to create empowered teams and this book provides both the foundational mindset and a VERY actionable guide. Highly recommended for any leader who wants a very effective way to communicate strategy w/o ambiguity.
Không cần phải giới thiệu về một trong những công cụ quản trị nổi tiếng nhất thế giới trong những thập kỷ qua. Đã đọc 2 quyển sách về Balanced Scorecard tuy nhiên quyển sách này khác biệt là nó được viết do chính cha đẻ của công cụ BSC. Tuy nhiên, tôi vẫn chưa có dịp được chứng kiến một doanh nghiệp nào áp dụng công cụ này thành công trong việc quản lý chiến lược. Nếu ai có kinh nghiệm về việc triển khai công cụ này có thể làm 1 buổi coffee talk chia sẻ kinh nghiệm để cùng nhau học hỏi.
This book sets out the basis for measuring performance in companies (medium to large) along four axes: finance, internal processes, clients, and learning and growth. Each of the quadrants has goals with associated performance indicators, ensuring success on several levels at once. If you read only one book on how to put together a system for running a company then this should be it.
The Balanced Scorecard translates a company's mission, vision, values, and strategy into a coherent set of performance measures. The four perspectives of a scorecard--financial, customer, internal processes, and learning and growth. These offer a balance between short-term and long-term objectives, desired outcomes, and performance drivers.
Tal vez uno de los libros sobre gestión empresarial más importantes que me he leído, bastante denso pero supremamente objetivo ... acompañado de la práctica, sería mucho más valioso. Requiere mucha concentracion por parte del lector, seguro una releida solo hará un mejor libro
Being in design leadership within a transforming organisation, I found the book extremely relevant and very well written. The languages is accessible and easy to understand, I highly recommend the book for those wanting to help shaping the direction of their organisation.
Was not what I expected it to be. Also, I could have just read the Appendix and gotten all of the information. Maybe if I was a CEO of a company in the 90’s this would have been helpful. As a Head Middle School Band Director, not so much.
This book is a bit dated as most of the strategies are now common business parlance. However the points on alignment being a process rather than a point-in-time activity still ring true.
One of the most important books I've ever read. At the same time hard to read at times as it's quite dull. Couldn't give it less than 5/5 so I rounded up
In my opinion the balanced scorecard is a great implementation for most organizations, in here you will find a general overview of the implementation of this tool.