Volume 80, November 2007: Balanced Scorecard

Keyzine: An E-zine for Leaders about the People Side of Business

This is a monthly electronic magazine for anyone who wants to be a better leader, coach, facilitator, or simply, to tune up their people skills. It is a complimentary publication, devoted to the next evolution of Quality Thinking.

Publisher: © Key Associates, LLC, 2007 ISSN # 1545-8873

“Poor measurement systems cause employees to question the competence of managers who “manage by the numbers’ when the numbers conflict with the economic reality and the organization’s objectives.” — Robert S. Kaplan

“I am ill at these numbers.” — William Shakespeare

“Anyone who thinks there are safety in numbers has not looked at the stock market pages.” — Irene Peter

“A manager who does not understand a process will attempt to manage it by the numbers.” — W. Edwards Deming


  • What’s Hot in Leadership
  • Maintaining Yourself as a Leader
  • Frequently Asked Questions from Leaders
  • Educational Opportunities
  • Useful Websites & Newsletters
  • Articles/Publications

What’s Hot in Leadership

  • Understanding measurement … but understanding that measurement is a proxy for the real thing.
  • Balancing the financial perspective with operational and human measures – customer viewpoints, service indicators, quality, and innovation.

Maintaining Yourself as a Leader

A colleague of mine used to ask: “What handful of indicators would you choose to determine if your organization is operating well? And if these numbers are in the optimal range, you could knock off and go play golf?”

Having a Balanced Scorecard is like looking at the dashboard of your car – if any of the dials indicate failure, your car will not run. Perhaps even be ruined.

What system of metrics do you trust?

Frequently Asked Questions

“What is a Balanced Scorecard?”
Developed by Kaplan & Norton (1993), the Balanced Scorecard is a management/measurement approach designed to translate vision and strategy into action. It views the performance of the organization from four perspectives: Learning and Growth; internal Business Processes; Customer Satisfaction; and Financial indicators. Each perspective includes objectives, measures, targets and initiatives.
The balanced scorecard consists of four sections: clarifying and translating vision and strategy; communicating and linking strategic objectives and measures; planning, setting targets, and aligning strategic initiatives; and enhancing strategic feedback and learning (Kaplan & Norton, 1996).
“What are some of the suggested metrics?”
How are we delighting our customers? Measure lead times, quality, performance and service, customer satisfaction, and value.
What must our company excel at? Determine the processes and competencies that are most critical, then specify measures, such as cycle time, quality, safety, employee skills, project management and productivity, to track them.
Third, how can your company continue to learn, improve and create value? Track your ability to launch new products, create more value for customers, and improve operating efficiencies. Notice number of employee suggestions, employee satisfaction/retention, % revenue from new services.
Fourth, how has your company done by its shareholders? Measure cash flow, project profitability, revenue per employee, operating income by division, increased market share by segment, reliability of performance, and return-on-capital-employed.
“How do we relate our daily work to the Scorecard?”
The measures you choose to track in each area are sometimes referred to as “the Big Dots.” Every project should connect to the Big Dots. The emphasis in work becomes move the Big Dots, not add more projects (Godfrey & Plsek, 2006).
Exercise: Create a scorecard of metrics, which, if all were operating at optimal levels, you could take off and play golf. Name a measure in each category that links business results to customer needs and expectations. (Tie this to all your business units.)
  • INTERNAL PROCESSES _____________
  • INNOVATION & IMPROVEMENT _____________
  • LEARNING & GROWTH ____________
  • FINANCIAL _____________
  • OTHER _____________


Balanced Scorecard User Group: Balanced Scorecard User Group.

Training, downloadable white papers, examples: Balanced Scorecard.

Useful Websites & Newsletters

The official newsletter of the Balanced Scorecard Revolution: Balanced Scorecard Report.

Free hosted trial on scorecards: Spider Strategies.

Automate balanced scorecards and dashboards: ActiveStrategy Enterprise.

Keyzines on related topics: The Strategic Plan, Measurement, Picture of a Process, and Simplify.



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