The Balanced Scorecard

You can use a Balanced Scorecard to define and measure success in your business.

The ‘Balanced Scorecard’ provides a methodology for translating an organisation’s mission statement and overall business strategy into specific, quantifiable goals and to monitor the organisation’s performance in terms of achieving those goals. Too often, easily measured financial data is used too readily to monitor performance, whereas any business needs to keep an eye on other aspects of performance and development.

Classically, a Balanced Scorecard methodology examines performance in four areas:

  1. Financial analysis, the most traditionally used performance indicator, includes assessments of measures such as operating costs and return-on-investment.
  2. Customer analysis looks at customer satisfaction and retention.
  3. Internal analysis looks at production and innovation, measuring performance in terms of maximizing profit from current products and following indicators for future productivity.
  4. Learning and growth analysis explores the effectiveness of management in terms of measures of employee satisfaction and retention and information system performance.

However, you can be creative and devise your own Balanced Scorecard to match those aspects of your own business that are important to monitor and improve, depending on your own Definition of Success.

Learn more about how a Balanced Scorecard can be a part of how to measure progress in your creative enterprise.

Read about other Business Concepts, Techniques and Terms that could be useful for your creative business.