The goal of creating a balanced scorecard is to translate the formulated corporate or innovation strategy into concrete target figures and key performance indicators. In addition, the effective determination of the necessary data on the performance of the company in relation to the target variables and the successful implementation of an organizational strategy is the goal of the scorecard.
Thus, especially in larger organizations, innovation management can be well aligned with corporate strategy using the scorecard.
The Balanced Scorecard is a strategic management or leadership system that translates the strategy into a system of key performance indicators based on the company’s mission statement or innovation target. This key performance indicator system can be used to control management processes such as communication, further development of strategy, corporate planning, incentive systems and strategic initiatives of a company.
It should be noted that the Balanced Scorecard is not a tool for formulating the right strategy. Rather, it is an instrument for implementing the company’s already formulated strategy.
To implement this, the success variables in the four central areas of finance, customers, processes, and learning and growth are mapped in a clear manner using around 25 metrics on a multidimensional “score sheet”.
To be able to create a balanced scorecard, you need experience in selecting the right perspectives and metrics and the ability to measure the success variables in each area.
The advantage of this method over benchmarking is that it does not rely on external data and the success of a strategy is measured against its own objectives.
