Balanced scorecard a strategic management tool
In the same way, it is crucial to spend some thought on the choice of measures and targets for each perspective.
The underlying idea is that economic and financial resources allow investment in skills and growth attracting talent, conducting research and innovation, training professionals, investment, etc.
Basic example of a strategic map. Figure 4. The authors found that younger executives and those with less time in their posts were more likely to use the BSC, and that they thought it made a positive contribution in terms of implementing strategies to control health care costs and provide greater managerial flexibility.
Consequently, the strategy maps and BSC developed by senior management transfer to the strategy maps and BSC at levels reporting to senior management, so as to ensure alignment between all of the maps and among all of the BSC.
Interestingly, the balance between different perspectives that characterized the first generation of BSC gave way in the second generation of BSC to an approach that used a hierarchy of perspectives, via strategy maps.
What if no strategy has been formulated for the hospital? Consequently, strategy maps became a basic component of the second generation of BSCs Figure 2.
How did the concept appear? The system has evolved over the years and is now considered a fully integrated strategic management system. The scorecard lets managers introduce four new processes that help companies make that important link.
Kaplan and David P.
Balanced scorecard accounting
Figure 5. First, one of the objectives within the Osakidetza Basque Health Service Strategic Plan was that all service organizations within the Osakidetza should have a strategic plan and a BSC by the end of that period. Executive Summary Reprint: RM The balanced scorecard revolutionized conventional thinking about performance metrics. The first generations of BSC therefore proposed new avenues for measurement systems through a structured combination of financial and non-financial metrics with strategic implications. Each BSC strategic map is unique, and will reflect the idiosyncrasies and strategic focus of individual organizations. Since then, the BSC has been updated yearly, and in the center decided to place the financial perspective at the bottom of strategic map, as shown in Figure 5. Further details regarding the study case and more information about using the dynamic systems with the BSC can be found in the above-mentioned paper, which can also be found among the references. ICT, information technology and communication. For each perspective, objectives, measurements, targets, and initiatives for achieving these targets are defined. The question here is how reasonable it is to expect that this hierarchical, top down sequence of development of the BSC will be universally applicable. HR, human resources. In that case, does it make sense to develop a BSC for an organization at the service level?
Design of the basic scorecard in health care organizations The BSC has become more widely used in health care organizations over the last decade. Full Text Introduction In a recent study, Bohmer 1 identified 4 habits that distinguish the most successful health care organizations and obtain the best outcomes.
Balanced scorecard in strategic management
The first generations of BSC therefore proposed new avenues for measurement systems through a structured combination of financial and non-financial metrics with strategic implications. A case in point was the hospital report on the Ontario Hospital Association cited above, in which the process perspective was replaced by a clinical management and outcomes perspective. There is a risk that the financial perspective gets too much weight, as it is tempting to let short-term financial objectives dominate the other three perspectives. Feedback about products and services. Translating the vision. Kaplan and Norton describe the innovation of the balanced scorecard as follows: "The balanced scorecard retains traditional financial measures. The first article by Kaplan and Norton on the BSC was published in , 15 and the first article specifically about the use of the BSC in the health sector appeared in An emphasis on results and the strategies needed to produce results is communicated throughout the organization. The scorecard does not replace the financial measures, it completes them. In the first section, we introduce measurement and performance monitoring as a key aspect of strategic management in health care organizations and identify the BSC as a potentially useful tool, which is often used for this purpose. Also, it encourages them to focus on complex cause and effect relationships and on developing a systemic aligned strategy. The end result should be focus across all levels of the organization that is consistent. From that starting point, the purpose of the present article is to review ways in which a specific management tool, the Balanced Scorecard BSC , can lead to improvements in strategic management and in particular to better strategy implementation and evaluation. The third—business planning—enables companies to integrate their business plans with their financial plans. It also relates, for example, the development of resources people, technologies, information systems, etc.
based on 83 review