As you start to think about New Year’s resolutions for your business, make sure you formulate goals that have quantifiable measurements. One tool that might be helpful in this endeavor is the balanced scorecard, a system of gauging business goals and expectations. The balanced scorecard was created by Robert Kaplan and David Norton of the Harvard Business School in the early 1990s to give managers and executives a more balanced view of business performance. The balanced scorecard measures nonfinancial goals in addition to traditional finance metrics. In the next couple of weeks, I will discuss the various aspects of a balanced scorecard and how they may help take your business to the next level.
The balanced scorecard has four integrated categories:
- Customer scorecard — Customer satisfaction and performance requirements
- Financial scorecard — Financial performance (requirements and goals)
- Internal business process scorecard — All processes that comprise your business
- Knowledge, education and growth scorecard — Retention and education of your employees, attaining more knowledge and keeping it within your company; keeping your competitive advantage
These four areas are critical to accomplishing true organizational balance. Each area on the scorecard requires equal focus in order for the company to continually improve. You might find it interesting to know that balanced scorecards have been successful enough that public and government sectors are now using them. The state of Utah has been using the method since 2005. Stay tuned for the next few weeks to find out more about each of the four areas and how they can help your business.
Let Zions Bank’s Business Resource Center assist you with your business needs. Call us for a free appointment at (801) 594-8245. We are open Monday through Friday from 9 a.m. to 5 p.m. Beth Holbrook can be reached at email@example.com.