Measurement — The Balanced Scorecard

Kaplan and Norton, whose quotation introduced this chapter, have also developed what is now a widely employed technique called the balanced scorecard. The balanced scorecard, or BSC, also has value in locking in supply chain changes. Use of concepts behind the balanced scorecard approach will also evaluate whether or not actions to support supply chain changes are having the desired effect. 

The BSC approach takes broad corporatewide goals and cascades them down into meaningful measures for departments, groups, and individuals. The balance in the balanced scorecard approach comes from the breadth of the measures. Rather than following the common practice of limiting measurement to financial information, the balance is provided by four perspectives  

Financial perspective the traditional viewpoint, including owner value. 

Customer perspective how the organization measures up with customers. 

Internal business perspective what the organization must excel at to be successful. 

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