The balanced scorecard

Traditional management accounts, with their emphasis on financial performance, tell us how a firm has performed in the past, but offer little information about how it might perform in the future.

To provide a more rounded view of how a firm is doing, Robert Kaplan and David Norton developed the ‘balanced scorecard’, a performance measurement system that considers not only financial measures, but also customer, business process and learning measures.

When to use it

  • To develop a rounded view of how a firm, or the various business lines within a firm, are performing.
  • To encourage managers to prioritise good customer service and develop their people, rather than just delivering on their financial goals.


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