What are the benefits of the Balanced Scorecard?

1	What benefits do organizations typically see out of adopting the Balanced Scorecard? Can the "return on investment" be calculated for the Balanced Scorecard? balanced-scorecard asked Mar 24 '10 at 21:11 Dylan ♦♦ 528●21●21●44

3 Answers:

oldest newest most voted

Organizations benefit from the use of the Balanced Scorecard in the following ways:

Clarify the vision throughout the organization
Gain consensus and ownership by the executive team
Provide a framework to align the organization
Provide structure for multiple initiatives
Drive the capital and resource allocation process
Integrate the strategic management process across the organization
Focus teams and individuals on strategic priorities

answered Mar 24 '10 at 21:12

Dylan ♦♦
528●21●21●44

Calculating an actual ROI is tricky because you are trying to discern between executing a strategy and the strategy itself. I had one client tell me that they would attribute 10% of their last 5 years of increased market cap to the BSC. The other 90%, they attributed to their actual strategy.

At first blush, it doesn't sound like much, but in 5 years, their market cap had increased by $2 billion. 10% of that is $200 Million. This organization invested less than $2 million in internal and external resources. That's a pretty nice ROI.

answered Mar 27 '10 at 14:14

Ted Jackson
133●9●9●15

2GC has a range of FAQ answers available on its web site - all for free / anonymous download. The FAQs are based on an analysis that 2GC did some years ago about the most frequently asked questions about Balanced Scorecard we could find in fora relating to Balanced Scorecard and performance management. Some of the FAQs that might be of interest with regard to this question are:

There are about 15 more FAQs on the 2GC site, along with case studies, presentations, and papers to read. Enjoy!

answered Mar 26 '10 at 16:45