Amir Zakaria Consulting Group | BSC
Traditionally, the Balanced Scorecard (BSC) divides an organization into four perspectives: financial perspective, customer perspective, internal process perspective, and learning and growth perspective (Kaplan and Norton, 1997).
BSC, the Balanced Scorecard, financial perspective, customer perspective, internal process perspective, learning and growth perspective, performance tool, performance objectives, strategy, strategy map, cause and effect, intangible assets, complex processes, decision-making, strategic planning, operational activities, business value, amir zakaria, amirzakaria, nazli monajemzadeh, اميرذكريا, نازلي منجم زاده, امير ذكريا
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Traditionally, the Balanced Scorecard (BSC) divides an organization into four perspectives: financial perspective, customer perspective, internal process perspective, and learning and growth perspective (Kaplan and Norton, 1997).

Lawrence (2002) indicates that in each of its perspectives, the BSC provides answers to four relevant questions:

  • How does the shareholders can benefit? (Financial Perspective);
  • How does the customers see the company? (Customer perspective);
  • What should be improved? (Perspective of internal processes);
  • Is it possible to continue to improve and create value? (Learning and growth perspective).

The BSC was developed by Kaplan and Norton and incorporates theories, such as shareholder value, principle-agent framework, uncertainty and multi-period optimization, and stakeholder management (Kaplan, 2009). Since its formulation by Kaplan and Norton (1992), a plethora of applications in different sectors and products were proposed (Cooper et al., 2017; Hoque, 2014). The BSC is a performance tool that provides managers with the mechanisms to develop performance objectives and measures linked to strategy (Phillips, 2007).

The BSC is a technique that aims at integrating and balancing all major existing performance indicators in a company from the financial/administrative to those relating to internal processes (Kaplan and Norton, 2004). The strategy map of the BSC displays hypothesis of the strategy, and each indicator becomes part of a logical chain of cause and effect that connects the desired outcomes of the strategy (Kaplan and Norton, 2004).

The strategy map describes the process of transforming intangible assets into tangible results for customers and therefore, in financial results (Kaplan and Norton, 2004). This tool aims at decoding the complex processes of decision-making, enabling a better monitoring and evaluation of the strategy. The BSC components are associated as follows:

  1. Strategy map: interpretation of the strategy into quantifiable goals, establishing cause-effect relations between components;
  2. The indicators measure the degree of achievement of the proposed objectives and influence the behavior of people in the pursuit of the goal;
  3. The goals and initiatives provide the speed and the priority of the implementation process in pursuit of achieving a goal;
  4. The strategic initiatives specify how to achieve the set targets and eliminate or neutralize the causes identified. It represents a project, program or strategy and should be interpreted into operational actions and budgets. They should represent actions or operational routines (meetings, reporting, etc.). It may be related to more than one strategic objective.

The main objective of the BSC is to seek alignment between the strategic planning of an organization and the operational activities that it carries (Kaplan and Norton, 1997). In this sense, it aims to translate the mission and strategy into objectives and measures, organized by indicators that will inform all members of an organization about the drivers of current and future success. Thus, it is expected that the BSC conduct energy, skills and knowledge of all the organization’s employees to reach long-term goals. By building these strategic capabilities, organizations provide value to the market, while providing an increased business value for its shareholders. The BSC is considered an effective and flexible tool to formulate strategies and increase performance of organizations, allowing managers to adapt it to different forms and add new perspectives according to the interest of the organization (Figge et al., 2002; Falle et al., 2016). “The balanced scorecard has evolved from its early use as a simple performance measurement framework to a full strategic planning and management system, and it enables executives to truly execute their strategies” (Rajesh et al., 2012, p. 270; Guerra, 2016).


  • Cooper, D., Ezzamel, M., Qu, S. (2017). “Popularizing a management accounting idea: the case of the balanced scorecard”. Contemp. Account. Res. 34 (2), 991–1025.
  • Figge, F., Hahn, T., Schaltegger, S., Wagner, M. (2002). “The sustainability balanced scorecard e linking sustainability management to business strategy”. Bus. Strategy Environ. 11, 269e284.
  • Falle, S., Rauter, R., Engert, S., Baumgartner, R.J. (2016). “Sustainability Management with the Sustainability Balanced Scorecard in SMEs: findings from an Austrian Case Study”. Sustainability 8, 545.
  • Guerra, J., Garcia, J., Lima, M., Barbosa, S. B., Heerdt, M. L., Berchin, I. I. (2016). “A proposal of a Balanced Scorecard for an environmental education program at universities”. Journal of Cleaner Production, P. 1-17.
  • Hoque, Z. (2014). “20 years of studies on the balanced scorecard: trends, accomplishments, gaps and opportunities for future research”. Br. Account. Rev. 46 (1), 33–59.
  • Kaplan, R., Norton, D. (1992). “The balanced scorecard: measures that drive performance”. Harv. Bus. Rev. 33 (7/8), 172–180.
  • Kaplan, R.S., Norton, D.P. (1997). “The Balanced Scorecard: Translating Strategy into Action”. Rio de Janeiro: Campus.
  • Kaplan, R.S., Norton, D.P. (2004). “Kaplan e Norton na pratica”. Elsevier, Rio de Janeiro.
  • Kaplan, R.S. (2009). “Conceptual foundations of the balanced scorecard”. Handbooks of Management Accounting Research, vol. 3. pp. 1253–1269.
  • Lawrence, S. (2002). “Commodification of education and academic LABOUR e using the balanced scorecard in a university setting. Crit. Perspect”. Account. 13, 661e677.
  • Phillips, P.A. (2007). “The balanced scorecard and strategic control: a hotel case study analysis”. Serv. Ind. J. 27 (6), 731–746.
  • Rajesh, R., Pugazhendhi, S., Ganesh, K., Ducq, Y., Lenny Koh, S.C. (2012). “Generic balanced scorecard framework for third party logistics service provider”. Int. J. Prod. Econ. 140, 269e282.

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