Balanced Scorecard Strategy For Dummies®

Chapter 9. Building the Financial Leg Scorecard

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• Selecting the right measures

• Finding the best financial fit to your business model

• Leveraging opportunities revealed by scorecards

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This is it. The financial measurement chapter. This is where the rubber meets the road, as they say. We’re going to go out on a limb and take a wild guess that you are probably looking in this chapter for one of three reasons:

✓	Your company is doing ok, but just not making the numbers as well as you think it should.
✓	Your department can’t make the budget this year, and you are thinking maybe it has something to do with the formulas, or the way things are calculated.
✓	Sales this year are doing great, but your margin is eroding, and you are looking for some way to explain why this is happening.

Although this list isn’t all-inclusive, the point is, you tend to first direct your attention to the financials when things are not working the way they should, or when you’re not meeting your goals. Why? Because as rational, human beings (we know we’re making a big assumption here) there must be a logical explanation for our current performance situation. And what better way to explain a business performance situation than numbers, right?

Well, guess what? You are in for a big surprise. Among other things, this chapter will dispel such erroneous beliefs, because performance is really a function of all four of the Balanced Scorecard legs, not just the financial one. We will ...