BALANCED SCORE CARD

Application in Performance Appraisal

Team Members:
Binu Joseph (06)
Divya Boddu(07)
Aikta Dube (08)
Meghraj Gawande(09)
Saurabh Goswami(10)
PERFORMANCE APPRAISAL

• The process of evaluating the performance of the holder of

the job based on the requirements contained in his/her job
description.

• This is the most helpful tool an organization can use to

maintain and enhance productivity and facilitate progress
towards strategic goals.

• It is a means to monitor the way employee work and assess

how this matches with organizational needs.

• Through this managers form impressions about the

employees and seek to maximize the contribution of each
individual.
THE BALANCED SCORE CARD
• Developed by Harvard Professors Robert Kaplan and David
Norton in early nineties

• The logic of BS is that learning and people management help

organizations improve their internal processes(product
development, service etc.) which are critical for creating
customer satisfaction and loyalty

• Customer value creation in turn drives financial performance

and profitability

• BS enables to translate broad corporate goals into

divisional, departmental and team goals in a cascading
fashion which helps an individual to see clearly how his
performance ties with overall performance of the firm.
THE FOUR PERSPECTIVES
OF PERFORMANCE:
• Customer

• Internal business process

• Learning and Growth

• Financial
STRATEGIC MAPS
• It is a one-page graphical representation of what
we must do well in each of the four perspectives in
order to successfully execute our strategy
• “What we must do well” is answered in the form of
objectives in a strategy map
• A few strategic objectives within each of the
perspectives are selected, and then the cause-
effect chain among these objectives are defined by
drawing links between them.
• The whole idea is represented in a compelling way
so that it is easily understood and embraced by all
employees.
STEPS FOR BALANCED SCORE
DEVELOPMENT
• Assessment of vision, mission and values of the
organization.
• Strategy –Customer values, strategic themes and strategic
results.
• Objectives- Strategy elements
• Strategic Maps- Objectives are linked
• Performance Measures- Targets and baselines
• Projects
• Application and Automation- Knowledge sharing and
performance measurement software.
• Cascade- Business units and Support units
• Evaluation- Performance results and Revise strategy
STEPS FOR BALANCED SCORE
DEVELOPMENT
USES OF BALANCED SCORE CARD

• Translating the vision into operational goals.

• Communicating the vision and link it to individual

performance

• Business planning.

• Feedback, learning and adjusting the strategy

accordingly.
Advantages of Balanced Score
Card

• It translates vision and strategy into action.

• It defines the strategic linkages to integrate

performance across organizations.

• It communicates the objectives and measures to a

business unit.
Continued..

• It aligns the strategic initiatives in order to attain the

long-term goals.

• It aligns everyone within an organization so that all

employees understand how they support the strategy.

• It provides a basis for compensation for performance.

• The scorecard provides a feedback to the senior

management if the strategy is working.
Continued..

• Focusing the whole organization on the few key

things needed to create breakthrough performance.
• Helps to integrate various corporate programs.
Such as: quality, re-engineering, and customer
service initiatives.
• Breaking down strategic measures towards lower
levels, so that unit managers, operators, and
employees can see what's required at their level to
achieve excellent overall performance.
Disadvantages of Balanced Score
Card
• It is not easy to implement this tool because it
involves a lot of subjectivity.
• The tool is much more complex compared to the
other tools
• The measures that need to be taken is contingent
upon the kind of environment, industry and the
business the organization is in.
• A lot of refinement is still required to be done so
that it becomes understandable to every
stakeholder associated with the organization.