Balanced Scorecard: A Strategic Management Tool for Organizational Success

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Introduction
The balanced scorecard can be rightfully described as a strategic management tool which
is largely used by the different organizations in order to ensure long term success and to carry
out the different organizational objectives. The given report will outline an understanding of the
tool (Akkermans & Van Oorschot, 2018). These organizational objectives include the objectives
like communication of their accomplishment, aligning the daily tasks of the organization,
prioritization of the products, services and projects along with the balanced measurement of the
progress towards the strategic targets of a firm (Bhattacharya et al., 2016). The system helps in
gathering the different strategic elements like the mission, vision, the core values of the firm and
the strategic focus areas like the goals and results in an attempt to link them with different
operational elements like the objectives of the firm, measures of the firm and the targets (Busco
& Quattrone, 2015). Moreover, it suggests a certain set of initiatives which the organization must
undertake in order to achieve those targets.
Analysis
For the purpose of convenience the Balanced Scorecard is primarily divided into four
different perspectives each of which are used to develop the objectives, measures, the Key
Performance Indicators and the targets which go a long way in helping the firm to achieve an
overall success (Cooper, Ezzamel & Qu, (2017). The first perspective is the financial objective.
The financial objective views the performance of the firm in financial terms and makes use of
various financial resources in order to ensure that the firm achieves success.
In the next perspective, there is the Customer perspective whereby the progress of the
organizational performance can be considered from the perspective of the customers or other

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crucial stakeholders which the organization primarily serves (Gibbons & Kaplan, 2015). The
third perspective is the internal process perspective which aims to view the organization from the
point of view of the quality of the internal products and the manner in which the processes are
carried out in the organization (Hoque, 2014). The last perspective is the capacity of the
organization or the Organizational capacity or Learning and Growth perspective which helps in
the understanding of the performance of a firm from the point of view of the technology
employed, human capital of the firm, the infrastructure and other related capacities.
Having understood the basic concept behind the Balanced scorecard, it is very important
to understand the relationship of the of the Balanced scorecard with the different aspects like that
of planning, strategies, motivation and cybernetic effects in order to ensure that the tool is
suitable for the organization at large (Kang et al., 2015). The most important aspect of the
balanced scorecard is that it helps to formulate different strategies which then helps the firm to
increase revenue, improve the customer as well as stakeholder experience and ensure that the
different organizational members are able to improve the cost efficiency of the firm at large
(Tjader et al., 2014).
Along with this, the balanced scorecard is related to various other elements of the firm in
the following manner:
 It improves strategic planning: It ensures that the organization is able to make the
different decisions in advance which ensure successful strategic planning (Keyes, 2016).
 Improves communication: It improves the communication which takes place in the
organization so as to ensure that the comfort level of the different employees improve and
bonding exists.