Balance Scorecard:

The balanced scorecard (BSC) is a strategy performance management tool a semi-

standard structured report, supported by design methods and automation tools,.

It can be used by managers to keep track of the execution of activities by the

staff within their control and to monitor the consequences arising from these
actions.

Components:

Balanced scorecard has four main components

A destination or Vision statement. This is a [one or two page] description of

the organization at a defined point in the future, assuming the current
strategy has been successfully implemented. The descriptions of the
successful future are segmented into perspectives for example financial &
stakeholder expectations, customer & external relationships, processes &
activities, organization & culture
A strategic linkage model. This is a version of the traditional strategy map
that typically contains 12-24 strategic objectives segmented into two
perspectives, activities and outcomes, analogous to the logical framework.
Linkages indicate hypothesized causal relations between strategic objectives.
A set of definitions for each of the strategic objectives.
A set of definitions for each of the measures selected to monitor each of the
strategic objectives, including targets.

Design Process

The design process for balanced scorecard requires the active involvement of
the management team who will eventually use the balanced scorecard.
The managers themselves make all decisions about the balanced scorecard
content.
The process begins with the development of a 'destination or Vision
statement' to build management consensus on longer term strategic goals.
This document is then used to build a 'strategic linkage model', describing
the shorter term management priorities, both the strategic activities to
complete and the strategic outcomes to achieve.
Once the 'strategic objectives' are decided in outline these are assigned
'owners' from within the management team, who further define each
objective, plus the measures and targets associated with achieving each
objective.
Objectives, goals and outcomes are refined by the responsible managers
themselves.
 All measures and targets must be reviewed to ensure that they are
interconnected (dependencies identifies) and congruent (appropriately
prioritized and support one another).
In large/ complex organizations the scorecard can be developed by functional
or project specific areas to relate to the management team for that area.
It is important in this case for the team creating the scorecard to understand
the linkages between their area and that of other management teams across
the organization with whom they may collaborate or have as stakeholders/
customers.
In many cases the objectives for the scorecard of a functional or project
organization will include cascaded objectives and priorities of the host
organization/ senior leaders/ their stakeholders (what is important to them).