STAGE 2 - Balanced Scorecard for Skills

BACKGROUND

Kaplan and Norton developed the balanced scorecard in 1992.* They believed that measurement was a key part of an effective management system. However, they noted that most organizations only measure financial metrics like profit, cash flow and return on equity.

Of course these metrics are critical to judging the success of a business. However, management based purely on financial metrics has been likened to driving a car by looking at the review mirror…financial metrics tell the organization what it has already done, not what it is likely to do in the future. The Balanced Scorecard can be thought of as the car's full instrumentation panel (i.e. fuel gauge, speedometer, and tachometer).

Many organizations realize that the costs of collecting data can outweigh its usefulness. The Balanced Scorecard model attempts to economize on your data gathering efforts by focusing on the few metrics that are critical to achieving your strategy. ScorecardforSkills.com provides you with the tools to gather this information in a cost-effective manner.

*Robert S. Kaplan and Norton, David P. “The Balanced Scorecard – Measures That Drive Performance,” Harvard Business Review. January – February, 1992: 71 –79.