BALACE SCORE CARD

Meaning
Balanced Scorecard is an approach which provides information relating to financial and non-
financial measures from four different perspectives (i.e. Customer Perspective, Internal
Business Perspective, Innovation & Learning Perspective, Financial Perspective) to
management to assist in strategy formulation and implementation.
Objective
The objective of Balanced Scorecard is to provide a comprehensive framework for translating
the companys strategic objectives into a coherent set of financial and non-financial
performance measures.
Perspectives/Elements/Components
The central idea of the Balanced Scorecard is that managers should develop the measures on
which they manage the business from four different perspectives. An ideal Balanced score
card combines financial measures of past performance with measures of the firms drivers of
future performance. The following perspectives are evaluated:
1. Customer Perspective: It considers performance measures of Price, Delivery, Quality,
Support.
2. Internal Business Perspective: It considers performance measures of Efficiency of
manufacturing Process, Sales penetration, New Product introduction.
3. Innovation & Learning Perspective : It considers performance measures of
Technology Leadership, Cost Leadership, Market Leadership, Research & Development
4. Financial perspective: It considers performance measures of sales, cost of sales,
profitability, prosperity.