Balanced scorecards

Today's business and market conditions change so quickly that keeping control on them becomes the most difficult task. Due to that, performance management becomes an aspect that requires more and more attention. Managers need to understand, though, that all parts of their work are tightly connected with timely data.
Here timely is the key. There still are a lot of cases of companies which are being managed basing on data from before a month or two. How suicidal it is, prove the cases of companies which have already filed for bankruptcy. All in all, irresponsible managing is the most common cause of companies' fails. Thereupon, one of the most important thing is to get a tool able to provide managers with the most timely data possible.
This might be achieved with: dashboards and balanced scorecards.

Balanced scorecards in general

The balanced scorecard, often called shortly "BSC", is a kind an automated report, which goal is to provide managers with possibilities for controlling company's current performance. With balanced scorecards, though, managers can focus on companies' goals and their realization progress. As the conditions are changing constantly, it is extremely important to keep control on them, and the situation which managers make decisions based on out-of-dated data cannot occur. Thereupon, unlike other tools, balanced scorecards can be supported with timely data which is indispensable for making efficient decisions.

As balanced scorecards are being often compared to taking a trip, there are a few aspects that characterize every efficient scorecard. Beginning with stating the goals to achieve, managers - while building a scorecard - create a tool to support them during whole their further work. As for that, building a balanced scorecard usually requires quite a lot of attention.

Balanced scorecard features

The balanced scorecards grow their popularity due to the features they offer to their users. Each of them is connected with different goal in management, which might be represented as follows:

Using a balance scorecard - why and what for?

Even though business evolves and technology is commonly-accessible for all companies, regardless of their types and sizes, still a lot of them function like it was 1800. It's visible in a matter of data flow, especially. Managers, thinking of making reasonable and efficient decisions, need to use as timely data as possible. In plenty of cases, it's being treated like a superfluous fancy, while their executives make decisions based on data from before a month or even older. One would think that the results of such behavior are easy to predict. If they were, why wouldn't these companies change that? Then, where is a place for balanced scorecards?

The balanced scorecards, in most cases, are being used for visual presenting information crucial for company's strategy. These days, it's not a big deal to list thousands of numbers illustrating each goal. Unfortunately, all these numbers, put together, illustrate nothing, in fact, as they are too difficult to understand. Thereupon, there was a need for inventing a tool able to concentrate what is the most important at one place, and present it as clearly and transparently as possible.

Finally, balanced scorecards allow managers to control how achieving the goals proceeds. It always is useful to know which goals are being achieved faster, and which - slower. Moreover, thank to balanced scorecards, strategy can be considered from another point of view, as well. What also is important, each departments' or employees' influence and contribution in proceeding the strategy might be easily-examined. All in all, whole thing might be boiled down to evaluating whether the company is on or off track in case of achieving goals that had been stated. How managers do that, depends solely on them, as balanced scorecard is only one of the tools facilitating performance management. It also is not to say that technology could replace the manager nor that the good instinct have no meaning. It is to say that there is a compromise needed, so that managers could use all accessible tools in a way that suits them best, and in a way that let them increase the efficiency to the maximum, regardless of whether they use balanced scorecards, dashboards, or other solutions.